Canola down with soybeans on good South American prospects even as canola carryout shrinks

Aside from corn, it was a down day on North American crop futures exchanges on Tuesday.

May canola slipped $2.40 to close at $522.60 per tonne reflecting weakness in Chicago soybeans and soy products.

New crop November canola edged down 50 cents to close at $501.00 per tonne.

Chicago corn edged slightly higher on news of new U.S. export deals.

Rain continues to be an issue in South America as harvest progresses there, but it does not appear to be causing major, widespread problems.

SOUTH AMERICA

Brazil’s soybean harvest reached 24.8 percent of planted area by Feb. 17, above the five-year average of 17.1 percent for this time of the year, Safras & Mercado consultancy said on Monday, Reuters reported. Yields generally are said to be good, but in some districts, farmers are concerned that if rain continues crop quality could suffer.

Meteorologists in Argentina said soybean and corn crops are developing nicely.

“If you could harvest the crops today, which you cannot because they’re not mature yet, the yield would be very good,” Stella Carballo at the government’s Climate and Water Institute told Reuters. “The rains and the temperatures have boosted yields, which could be record highs for corn and soy.”

The Buenos Aires Grains Exchange said last week that 2016-17 soy production could surpass the 54.8 million tonnes currently expected if favourable climate conditions persist, Reuters reported.

WHEAT

All three U.S. wheat contracts fell. Prospects for a stronger U.S. dollar as American interest rates rise weighed on wheat’s export outlook. However, for this week anyway, USDA’s wheat export total beat expectations at 558,252 tonnes, topping a range of trade expectations for 350,000 to 550,000 tonnes.

USDA OUTLOOK

The U.S. Department of Agriculture hosts its annual outlook conference in Washington this week. It will issues its economists’ forecast for 2017 U.S. corn, soybean and wheat acreage.

CANOLA CHINA

It was a year ago this week that China announced it would impose new lower allowable limits on dockage in canola as of April 1. That deadline was then delayed until Sept. 1 and finally delayed indefinitely until officials on both sides can negotiate a more permanent solution.

The uncertainty over the issue lead to slow canola exports to China in September. The export pace has recovered and total export shipments to date are now at a record pace.

This year, the non-tariff barrier is coming from India, which will require as of March 31 grain and pulse imports to be fumigated with methyl bromide at the point of departure. Canada and other countries have banned the used of methyl bromide.

AG CANADA SUPPLY AND DEMAND

Agriculture Canada updated its supply and demand spreadsheet on Friday.

It raised its canola export forecast by 500,000 tonnes to 10 million and domestic crush by 100,000 tonnes to nine million tonnes. Feed and waste was increased to 388,000 from 88,000 previously. It appears that Agriculture Canada figures a percentage of the canola still sitting in fields is going to wind up as waste.

It lowered its canola year end stocks estimate to a tight 1.1 million tonnes from two million in the previous report.

It also put the 2017-18 year end stocks forecast at a tight 1.1 million tonnes.

Reflecting the poor condition of wheat and durum this year, Agriculture Canada lowered its forecast of durum used domestically and raised its year-end stocks forecasts to 2.8 million tonnes, from 2.6 million.

For wheat it lowered the amount exported and used domestically and raised its year-end stocks to four million tonnes from 3.5 million.

In pulse crops, it left the pea numbers alone but it raised its lentil export number by 200,000 tonnes and cut its year-end lentil stocks to 425,000 tonnes from 625,000 previously.

OUTSIDE MARKETS

Light crude oil nearby futures in New York were up 66 cents to US$54.06 per barrel.

Oil rose as OPEC reported good compliance on its plan to reduce crude production.

The Canadian dollar at noon was US76.05 cents, down from 76.24 cents the previous trading day. The U.S. dollar at noon was C$1.3149.

Stock market indexes hit fresh all time highs, supported by strong quarterly results at major U.S. retailers and the best pace of business activity in the Euro Zone in six years.

The Toronto Stock Exchange’s S&P/TSX composite index .GSPTSE unofficially closed up 83.74 points, or 0.53 percent, at 15,922.37.

The owner of Tim Hortons and Burger King has a deal to buy fried chicken chain Popeyes, a chain with 2,600 outlets.

The Dow Jones Industrial Average rose 118.95 points, or 0.58 percent, to 20,743, the S&P 500 gained 14.22 points, or 0.60 percent, to 2,365.38 and the Nasdaq Composite added 27.37 points, or 0.47 percent, to 5,865.95.

 

Winnipeg ICE Futures Canada dollars per tonne

Canola Mar 17 516.70 -1.00 -0.19%

Canola May 17 522.60 -2.40 -0.46%

Canola Jul 17 525.50 -1.70 -0.32%

Canola Nov 17 501.00 -0.50 -0.10%

Canola Jan 18 506.20 -0.70 -0.14%

 

Milling Wheat Mar 17 229.00 -1.00 -0.43%

Milling Wheat May 17 233.00 -2.00 -0.85%

Milling Wheat Jul 17 235.00 -2.00 -0.84%

 

Durum Wheat Mar 17 281.00 -7.00 -2.43%

Durum Wheat May 17 283.00 -7.00 -2.41%

Durum Wheat Jul 17 282.00 -7.00 -2.42%

 

Barley Mar 17 135.00 unch unch

Barley May 17 137.00 unch unch

Barley Jul 17 138.00 unch unch

 

American crop futures in cents US/bushel, soybean meal in $US/short ton, soy oil in cents US/pound

 

Chicago

Soybeans Mar 2017 1026.25 -8.50 -0.82%

Soybeans May 2017 1037.25 -8.75 -0.84%

Soybeans Jul 2017 1046.25 -8.75 -0.83%

Soybeans Aug 2017 1045.25 -8.75 -0.83%

Soybeans Sep 2017 1029.00 -7.00 -0.68%

Soybeans Nov 2017 1014.50 -6.25 -0.61%

 

Soybean Meal Mar 2017 337.40 -3.20 -0.94%

Soybean Meal May 2017 341.90 -3.00 -0.87%

Soybean Meal Jul 2017 345.10 -2.70 -0.78%

 

Soybean Oil Mar 2017 32.67 -0.26 -0.79%

Soybean Oil May 2017 32.95 -0.24 -0.72%

Soybean Oil Jul 2017 33.22 -0.24 -0.72%

 

Corn Mar 2017 369.25 +0.75 +0.20%

Corn May 2017 376.50 +0.75 +0.20%

Corn Jul 2017 383.75 +0.75 +0.20%

Corn Sep 2017 389.50 +1.50 +0.39%

Corn Dec 2017 395.75 +1.25 +0.32%

 

Oats Mar 2017 252.50 -4.50 -1.75%

Oats May 2017 250.75 -0.75 -0.30%

Oats Jul 2017 246.50 +1.25 +0.51%

Oats Sep 2017 238.50 unch 0.00%

Oats Dec 2017 235.00 -3.50 -1.47%

 

Wheat Mar 2017 436.00 -6.50 -1.47%

Wheat May 2017 449.75 -7.50 -1.64%

Wheat Jul 2017 464.25 -6.25 -1.33%

Wheat Sep 2017 479.75 -6.25 -1.29%

Wheat Dec 2017 497.25 -5.75 -1.14%

 

Minneapolis

Spring Wheat Mar 2017 541.25 -7.00 -1.28%

Spring Wheat May 2017 549.25 -6.25 -1.13%

Spring Wheat Jul 2017 555.25 -7.75 -1.38%

Spring Wheat Sep 2017 561.25 -4.25 -0.75%

Spring Wheat Dec 2017 571.25 -6.00 -1.04%

 

Kansas City

Hard Red Wheat Mar 2017 452.25 -4.50 -0.99%

Hard Red Wheat May 2017 465.50 -4.00 -0.85%

Hard Red Wheat Jul 2017 477.25 -3.50 -0.73%

Hard Red Wheat Sep 2017 491.50 -3.25 -0.66%

Hard Red Wheat Dec 2017 511.00 -4.25 -0.82%

 

Chicago livestock futures in US¢/pound (rounded to two decimal places

Live Cattle (P) Feb 2017 119.10 +1.10 +0.93%

Live Cattle (P) Apr 2017 115.30 +0.52 +0.45%

Live Cattle (P) Jun 2017 105.95 +0.77 +0.73%

 

Feeder Cattle (P) Mar 2017 124.55 +0.58 +0.47%

Feeder Cattle (P) Apr 2017 125.12 +0.94 +0.76%

Feeder Cattle (P) May 2017 124.38 +1.13 +0.92%

 

Lean Hogs (P) Apr 2017 70.35 -0.30 -0.42%

Lean Hogs (P) May 2017 75.45 -0.27 -0.36%

Lean Hogs (P) Jun 2017 79.05 -0.07 -0.09%

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