It was a case of buy the rumour and sell the fact Friday as corn and wheat fell after as new evidence pointed to a large corn sale to China.
Oilseeds shook off the decline in cereals and rose on harvest problems in Brazil where there has been excessive rain in northern growing areas.
May canola gained $8.50 per tonne on the week.
The United States Department of Agriculture on Friday said exporters sold 1.25 million tonnes of corn to an unidentified buyer, appearing to confirm the China deal. One million of it is to be shipped in the current marketing year. Prices rallied early in the day on the news, but then dropped back on profit taking.
Rumours of the deal helped to lift corn futures by 11 percent March 17-18. Traders said there could be an announcement of another 500,000 tonnes in sales to China by next week.
USDA also recorded a sale of 116,000 tonnes of U.S. wheat to China, raising ideas that China’s wheat crop did not survive the winter drought as well as Chinese authorities allege. Shanghai JC Intelligence Co. told Bloomberg News that the Chinese harvest could be 11 million tonnes less than the government estimate. It said China might import more than two million tonnes of wheat this year.
The forecasts for the western hard red winter wheat belt turned drier today. On Thursday the forecast showed a better chance of rain next week but that has now turned into a forecast for sprinkles of less than 2.5 millimetres.
Kansas City futures rose, but Chicago and Minneapolis wheat fell on the day.
The Canadian Oilseeds Processors Association reported members crushed 128,337 tonnes of canola in the week ending March 23, an increase of almost seven percent from the week before.
European Coceral released its first forecast of European Union production for this year. It sees the rapeseed crop dropping one percent to 20.17 million tonnes. Frost damage in key producer Germany was the main reason. Increase production in Britain and France would not make up for the losses in Germany.
Farmers in Russia are worried about a slow start to spring planting but are expected to get going next week. The Russian Grain Union, the top farm lobby, said grain production could climb as high at 86 million tonnes this year but could also be only 76 million tonnes if weather does not cooperate.
Domestic consumption is about 72-74 million tonnes.
Last year, drought slashed production to 60.9 million tonnes.
Winnipeg (per tonne)
Canola May 11 $581.30s, up $1.90
Canola Jul 11 $589.70, up $1.80
Canola Nov 11 $567.00, up 90 cents
Canola Jan 12 $571.80, up 90 cents
The previous day’s best basis was steady at $16.13 under the May contract according to ICE Futures Canada in Winnipeg.
The May contract’s Relative Strength Index was 52. The rule of thumb is an RSI of 30 indicates an over sold market and 70 indicates an over bought market.
Western Barley May 11 $200, unchanged
Chicago (per bushel)
Soybeans May 11 $13.5825, up 3.75 cents
Soybeans Jul 11 $13.685, up 4 cents
Soybeans Nov 11 $13.5025, up 6.75 cents
Corn May 11 $6.895, down 13 cents
Corn Dec 11 $6.095, down 9.25 cents
Oats May 11 $3.49, up 0.5 cents
Oats Jul 11 $3.575, up 0.25 cents
Minneapolis (per bushel)
Spring Wheat May 11 $8.81, down 2.25 cents
Spring Wheat Jul 11 $8.8925, down 2 cents
Spring Wheat Dec 11 $9.0675, down 2.75 cents
Light crude oil nearby futures in New York fell 20 cents to $105.40 US per barrel.
The Conservative government fell on a no confidence motion so the country will vote in early May.
The Canadian dollar at noon was $1.0227 US, up from $1.0259 the previous trading day. The U.S. dollar at noon was 97.78 cents Cdn.
The Toronto Stock Exchange composite index rose 10.02 points, or 0.07 percent, at 14,039.39.
The Standard & Poor’s 500 Index added 6.84 points, or 0.52 percent, to 1,316.50.
For the week, the TSX composite rose 1.8 percent, the S&P 500 rose 2.7 percent, the Dow rose 3.1 percent and the Nasdaq climbed 3.8 percent.
