Canola below $500 on technical weakness

Canola futures continued to slide on Wednesday but American crop futures edged higher on a round of short covering.

The biggest market news of the day came from the Federal Reserve. As expected, it raised its interest rate by 25 basis points.

Canola futures are under pressure as technical indicators are negative. And trading will start to wind down as we move toward Christmas.

Dry areas of Argentina’s soy belt are expected to get needed rain this week. Brazil’s crop is doing well.

WATCH OUR WEEKLY VIDEO MARKETS ANALYSIS

While Canadian canola exports are up year over year, American soybean exports are lagging behind last year.

FED RAISES RATES

The Fed raised its benchmark overnight lending rate three times this year.

It projected three more hikes in each of 2018 and 2019 before a long-run level of 2.8 percent is reached. That is unchanged from the last round of forecasts in September, Reuters reported.

Some analysts thought the Fed might announce a more aggressive round of increases given the recent round of fairly strong reports on the American economy.

In a case of buy on the rumour, sell on the fact, the American dollar dipped against most currencies following the Fed announcement.

The Fed forecasts the U.S. economy will grow by 2.5 percent in 2018, up from a forecast of 2.1 percent back in September. The strong showing should help to lift Canada’s economy as well.

OUTSIDE MARKETS

Light crude oil nearby futures in New York were down 54 cents at US$56.67 per barrel.

In the afternoon, the Canadian dollar was trading around US77.99 cents, up from 77.70 cents the previous trading day. The U.S. dollar was C$1.2822.

The TSX composite closed at a record high level.

The index closed up 22.56 points, or 0.14 percent, at 16,136.59.

The Dow Jones Industrial Average rose 80.63 points, or 0.33 percent, to end at 24,585.43, the S&P 500 lost 1.26 points, or 0.05 percent, to 2,662.85 and the Nasdaq Composite added 13.48 points, or 0.2 percent, to 6,875.80.

 

Winnipeg ICE Futures Canada dollars per tonne.

Canola Jan 18   498.70s   -1.40   -0.28%

Canola Mar 18   506.90s   -1.00   -0.20%

Canola May 18   514.20s   -0.60   -0.12%

Canola Jul 18   518.10s   -0.50   -0.10%

Canola Nov 18   503.50s   +0.90   +0.18%

 

American crop prices in cents US/bushel, soybean meal in $US/short ton, soy oil in cents US/pound. Prices are displayed with fractions (2/8, 4/8, and 6/8) instead of decimals. -2 equals .25, -4 equals .50, -6 equals .75. The “s” means it is the settlement.

 

Chicago

Soybeans Jan 18   979-2s   +3-4   +0.36%

Soybeans Mar 18   990-4s   +3-2   +0.33%

Soybeans May 18   1001-4s   +3-2   +0.33%

Soybeans Jul 18   1011-0s   +3-2   +0.32%

Soybeans Aug 18   1012-4s   +3-0   +0.30%

 

Soybean Meal Dec 17   325.1s   +2.2   +0.68%

Soybean Meal Jan 18   326.8s   +2.1   +0.65%

Soybean Meal Mar 18   330.9s   +2.0   +0.61%

 

Soybean Oil Dec 17   33.11s   -0.25   -0.75%

Soybean Oil Jan 18   33.21s   -0.24   -0.72%

Soybean Oil Mar 18   33.40s   -0.20   -0.60%

 

Corn Dec 17   336-6s   +1-0   +0.30%

Corn Mar 18   349-0s   +1-2   +0.36%

Corn May 18   357-2s   +1-2   +0.35%

Corn Jul 18   365-4s   +1-0   +0.27%

Corn Sep 18   372-4s   +0-6   +0.20%

 

Oats Dec 17   234-0s   +6-6   +2.97%

Oats Mar 18   249-0s   +5-4   +2.26%

Oats May 18   255-0s   +4-6   +1.90%

Oats Jul 18   262-4s   +4-2   +1.65%

Oats Sep 18   264-4s   +4-2   +1.63%

 

Wheat Dec 17   392-2s   +5-0   +1.29%

Wheat Mar 18   416-6s   +6-0   +1.46%

Wheat May 18   429-2s   +5-2   +1.24%

Wheat Jul 18   442-4s   +5-2   +1.20%

Wheat Sep 18   455-6s   +5-0   +1.11%

 

Minneapolis

Spring Wheat Dec 17   599-6s   +3-0   +0.50%

Spring Wheat Mar 18   612-4s   +7-0   +1.16%

Spring Wheat May 18   621-0s   +7-0   +1.14%

Spring Wheat Jul 18   625-4s   +6-6   +1.09%

Spring Wheat Sep 18   621-6s   +4-6   +0.77%

 

Kansas City

Hard Red Wheat Dec 17   399-0s   +5-0   +1.27%

Hard Red Wheat Mar 18   416-2s   +5-0   +1.22%

Hard Red Wheat May 18   429-2s   +4-6   +1.12%

Hard Red Wheat Jul 18   445-2s   +4-4   +1.02%

Hard Red Wheat Sep 18   459-4s   +3-6   +0.82%

 

Chicago livestock futures in US¢/pound, Pit trade

Live Cattle Dec 17   115.650s   -0.500   -0.43%

Live Cattle Feb 18   118.375s  -0.775   -0.65%

Live Cattle Apr 18   120.200s   -0.775   -0.64%

 

Feeder Cattle Jan 18   145.650s   -1.450   -0.99%

Feeder Cattle Mar 18   144.050s   -1.250   -0.86%

Feeder Cattle Apr 18   144.025s   -1.300   -0.89%

 

Lean Hogs Dec 17   63.950s   +0.200   +0.31%

Lean Hogs Feb 18   66.800s   +0.275   +0.41%

Lean Hogs Apr 18   71.475s   +0.300   +0.42%

 

 

 

 

About the author

Comments

explore

Stories from our other publications