An improved forecast for rain next week in Argentina sent most crop futures lower on Thursday.
Most traded March canola closed at $518.00 per tonne, down $2.60.
January closed at $518.00, down $2.60 but new crop November rose $1.10 to $511.30.
Crops futures on American exchanges were also under pressure from a rising U.S. dollar. Weekly reports on U.S. employment showed improvement, lifting stock markets early in the day and the U.S. buck. The euro dropped against the greenback as traders continue to worry about the region’s ability to fund its huge debt servicing costs.
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U.S. grains: Corn, soybeans fall as rain expected to help U.S. crops
Chicago corn and soybean futures fell on Monday on forecasts for crop-friendly rain in U.S. grain belts this week.
The Canadian dollar also fell, limiting the damage to canola futures. Talk of new exports to China also supported the canola market.
• It is supposed to remain hot and dry in Argentina until Monday when rain is expected. The Buenos Aires Grains exchange said moisture prospects were good in the seven to 10 forecast, but U.S.-based Commodity Weather Group said dry weather would return after the early week rain.
• Wheat futures were pressured after the Buenos Aires Grains exchange increased its estimate of the already harvested 2011-12 wheat crop to 14 million tonnes from its previous view of 13.6 million.
• The U.S. Climate Prediction Center said La Nina is weakening, but will likely persist longer than expected into early spring.
The latest sea temperature data suggests La Nina “will be of weak-to-moderate strength this winter, and will continue thereafter as a weak event until it likely dissipates sometime between March and May”
In December it predicted it would dissipate “with the onset of the northern spring.”
• The warm weather on the Canadian prairies this winter is partly the result of the Arctic Oscillation (AO), a phenomenon where atmospheric pressure patterns shift between the arctic and the mid latitudes. In the positive phase of the oscillation, the atmospheric pressure over the arctic is low and in the mid latitudes is high. This causes the cold to stay in the north and changes circulation patterns to deliver drier, warmer weather in the central part of the North American continent. In negative phases, the atmospheric pressure in the arctic is high, pushing cold air south.
This winter the oscillation has been mostly in the positive phase but last winter it tended to be negative.
While La Nina shifts slowly, the AO can change quickly.
You can track the AO at http://www.cpc.ncep.noaa.gov/products/precip/CWlink/
• Agriculture Canada posts regularly updated moisture maps for the Prairies and all of Canada at the following website. Click on “current conditions” when you get to the page.
http://www4.agr.gc.ca/AAFC-AAC/display-afficher.do?id=1256658312655&lang=eng
Winnipeg (per tonne)
Canola Jan 12 $518.00, down $2.60 (-0.50%)
Canola Mar 12 $523.60, down $2.00 (-0.38%)
Canola May 12 $528.40, down $0.40 (-0.08%)
Canola Nov 12 $511.30, up $1.10 (+0.22%)
The previous trading day’s best basis was $12 per tonne off the March contract, said the ICE Futures Canada exchange in Winnipeg.
The January contract’s 14-day Relative Strength Index was 57.
Western Barley Mar 12 $217.00, unchanged
Chicago (per bushel)
Soybeans Jan 12 $12.0125, down 20.25 cents (-1.66%)
Soybeans Mar 12 $12.09, down 21.0 (-1.71%)
Soybeans Nov 12 $12.04, down 15.25 (-1.25%)
Corn Mar 12 $6.435, down 15.0 (-2.28%)
Corn Dec 12 $5.795, down 10.25 (-1.74%)
Oats Mar 12 $2.90, down 3.0 (-1.02%)
Oats May 12 $2.9475, down 3.25 (-1.09%)
Minneapolis (per bushel)
Spring Wheat Mar 12 $8.185, down 20.5 cents (-2.44%)
Spring Wheat May 12 $8.095, down 20.5 (-2.47%)
Spring Wheat Dec 12 $7.7925, down 23.25 (-2.90%)
Nearby light crude oil in New York fell $1.41 to settle at $101.81 a barrel.
The Canadian dollar at noon was 98.07 cents US, down from 98.68 the previous trading day. The U.S. dollar at noon was $1.0197 Cdn.
In a preliminary tally, the Toronto Stock Exchange composite closed up 10.93 points, or 0.09 percent, at 12,237.40.
The Standard and Poor’s 500 was up 3.74 points, or 0.29 percent, at 1,281.04.
