It was another boffo day for crops Monday, as the Midwest drought bit into both soybean and corn potential yet again.
July canola futures were up $7.30 per bushel to $625 per tonne and November were up $11.10 to $586.20.
Canola’s rise was weak compared to soybeans and other crops, mostly due to the excellent condition most prairie crops are in. Warm, dry weather in the eastern prairies is creating the potential for a big crop.
The driving force of the overall crop market rally was the Midwestern dryness, which is spooking soybean and corn buyers. Continued heat and dryness is damaging yield prospects for both crops and hard red winter wheat is in trouble.
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Farm cash receipts in the first half of the year were up 3.3 per cent over the same period last year buoyed by livestock receipts. Overall receipts between January and June totalled $49.6 billion, up $1.6 billion from the same period last year, Statistics Canada reported.
July corn futures were locked limit-up at $6.31 per bushel while December were up the same 40 cent limit at $5.94.
Soybeans rose proportionately less, by 40-46 cents per bushel to $14.83 for July and $14.41 for December.
Oats rose the 20 cent per bushel limit to $3.48 for July and $3.24 for September.
The winter wheats rallied most Monday, with Chicago December wheat rising 52 cents per bushel to $7.59 and Kansas City wheat rising 48 cents on the September to $7.49.
Minneapolis wheat rose less, by 15 cents on the July contract to $8.74 and by 35 cents on the September to $8.13.
The rollicking rally in crops is in marked contrast to a generally dreadful day in equity, bond and currency markets. More Eurodread consumed markets, driving investors into another day of “risk off” behavior, running away from equities in North America and Europe and embracing the U.S. dollar.
Greece’s ramshackle government attempted to sort its way through the present forced restructuring and budget slashing, while two of its leaders dealt with serious health problems. Spanish bond yields rose again, pushing the country closer to financial unsustainability.
The prospect of yet another Eurosummit Thursday did not cheer market participants, after the string of previous summits that progressively have seemed to kick the can down the road less distance, with the most recent bailout relief rally lasting less than half an hour. Much attention was paid Monday to economics thinkers from across the spectrum, from Paul Krugman to Nouriel Roubini to Niall Ferguson, comparing 2012 to 1931.
The election of a Muslim Brotherhood president in Egypt, the downing of a Turkish spy plane by Syria and the loss of England and France in the European soccer championships added a sour note for some.
