Canola bucks trend and closes higher

Canola futures on Tuesday gained back a little of the ground lost Monday but U.S. crop futures ended in negative territory again.

November canola closed at $626.40 per tonne, up $4.80.

Chicago November soybeans closed at $16.40 per bushel, down 29 cents.

Monday’s price roll back was partly sparked by better than expected soybean yields in early seeded crops in the U.S. but the Canadian canola crop continues to encounter yield lowering challenges such as the gale force winds that scattered swaths last week.

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Analysts in Canada are lowering their estimates of the canola crop.

But a Reuters poll of 14 analysts showed an average estimate of U.S. soybean yields of 35.85 bu. per acre, that is up from the USDA official forecast of 35.3. Late season rain in the Midwest appeared to help soybeans but not corn.

• Analysts Oil World said there could be another market attempt to surpass $18 a bushel for soybeans in the next couple of months before the South American soy harvest is ready.

Chicago soybeans hit an all-time high of $17.9475 a bushel on Sept. 4.

Oil World said about 83 percent of American soybeans that will be available for sale in the first half of the crop year have already been sold. If China or another major soybean importer tries to buy much more, it could create an explosive price situation.

Oil World also said the U.S. might become a soybean importer late in its crop year, perhaps buying as much as a million tonnes, with about half coming from Canada and half from South America.

• The Australian Oilseeds Federation monthly crop report reduced its outlook for canola production to 2.73 million tonnes, a decline of 207,000 tones or seven percent.

The official government ABARES estimate of the Australian canola crop is 2.761 million tonnes.

Last year it produced 3.185 million tonnes.

• Today Agriculture Canada released its monthly supply and demand report. It pegs canola production at 15.41 million tonnes and total supply at 16.32 million. Many private analysts now have production forecasts that are below 15 million tonnes, particularly after the recent big blows.

Agriculture Canada sees exports at 8.8 million, up from 8.73 million last year. Total domestic use is pegged at 6.847 million, down from 7.267 million last year.

Ending stocks are seen at a tight 675,000 tonnes, down from 788,000 tonnes in 2011-12.

Its price projection is $630-$670 per tonne, up from an average $601 last year.

Canola Nov 12 $626.40, up $4.80 +0.77%

Canola Jan 13 $630.20, up $4.80 +0.77%

Canola Mar 13 $631.40, up $4.90 +0.78%

Canola May 13 $619.70, up $5.30 +0.86%

Milling Wheat Oct 12 $292.20, down $2.40 -0.81%

Milling Wheat Dec 12 $298.00, down $2.40 -0.80%

Milling Wheat Mar 13 $307.50, down $2.40 -0.77%

Durum Wheat Oct 12 $310.10, up $3.20 +1.04%

Durum Wheat Dec 12 $314.60, up $3.20 +1.03%

Durum Wheat Mar 13 $321.20, up $3.20 +1.01%