Canola edges higher on week, lifted by soy

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Published: November 21, 2014

By D’Arce McMillan, Markets editor

Twitter @ darcemcmillan

Oilseeds closed the day and the week slightly higher but corn and wheat fell a little.

Canola followed soybeans higher on Friday, even as the shine was dulled by a rising loonie.

The Canadian currency rose about a half cent after the government posted monthly inflation data that showed prices rose more than expected. The Bank of Canada is more likely to raise interest rates if inflation is on the rise. And the prospect of stronger interest rates attracts investment into the loonie and raises its value.

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Photo: JHVEPhoto/Getty Images Plus

U.S. grains: Soybean futures jump on hopes for US export demand

Chicago Board of Trade soybean futures jumped on hopes for U.S. export demand on Wednesday, while corn futures rose for a third day to extend a recovery from contract lows, analysts said.

Soybeans and canola futures are supported by the fact farmers are not rushing to sell.

Also, traders saw China’s announcement that it was lowering interest rates to stimulate its economy as a sign that the Asian giant might buy more oilseeds.

Canola also enjoyed a bit of support from rising palm oil today, but most analysts are not bullish on palm oil because of the weak export pace out of Malaysia and the effect of falling crude oil values.

Over the week, canola traded in a narrow range.

January canola closed today at $431.00 per tonne, up $3.20 over the week, or 0.75 percent

January soybeans closed at $10.38 per bushel, up 16.5 cents or 1.6 percent over the week.

December soy oil rose 1.5 percent over the week.

The pace of the weekly canola crush in Canada did not help canola.

The Canadian Oilseed Processors Association said members crushed 121.769 tonnes in the week ending Nov. 19, down 7.7 percent from the week before. That represented a capacity use of only about 68 percent.

However, the crush so far this crop year is still ahead of last year’s pace.

Corn gave back a little ground today after a sharp gain on Thursday, which was fueled by stronger than expected weekly U.S. export sales.

In the final minute of trading, corn prices reversed from big gains earlier.

The day’s low was $3.6975 per bushel after trading as high as $3.815. The tumble was tied to the expiration of December options on the contract, with a large volume of options at the strike price of $3.70, traders told Reuters.

More than 33,000 contracts traded in what was the most active minute of trading in December corn in a week, Reuters data showed.

If not for the last minute decline corn would have been almost steady over the week, but with the tumble at the close corn fell about 2.4 percent over the five days.

It was chaos,” independent corn options broker P.J. Quaid told Reuters. “Everyone squared up their December options position and threw in the towel at the last minute.”

Generally, the corn market is caught between the focus on the record size of the corn crop and the wind up of harvest, and weekly exports that are strong and ethanol production at a near record.

For the week, Chicago December wheat fell 1.25 cents or 2.4 percent, a setback from last week’s 8.9 percent surge. K.C. December wheat fell 1.5 cents or 0.2 percent on the week, and MGEX December spring wheat fell six cents or one percent.

Light crude oil nearby futures in New York rose 66 cents at US$76.51 per barrel.

The Canadian dollar at noon was US88.98 cents, up from 88.40 cents the previous trading day. The U.S. dollar at noon was C$1.1238.

Stock markets rose after China’s central bank cut its benchmark interest rate and the euro zone central bank announced asset purchases. Both regions are attempting to boost their economy.

In unofficial tallies —

The Toronto Stock Exchange’s S&P/TSX composite index closed up 35.95 points, or 0.24 percent, at 15,111.13.

The Dow Jones industrial average rose 88.94 points, or 0.5 percent, to 17,807.94.

The S&P 500 gained 10.7 points, or 0.52 percent, to 2,063.45 and the Nasdaq Composite added 11.10 points, or 0.24 percent, to 4,712.97.

The Dow and S&P ended at records.

For the week, The TSX composite was up 1.8 percent, the Dow rose one percent, the S&P climbed 1.2 percent and the Nasdaq rose 0.5 percent.

ICE Futures Canada’s barley and wheat contracts rose a little this week, reflecting the gains in more liquid contracts on other exchanges.

 

ICE Futures Canada, dollars per tonne

Canola Jan 2015       431.00       +0.70       +0.16%

Canola Mar 2015       433.50       +0.50       +0.12%

Canola May 2015       434.60       +0.40       +0.09%

Canola Jul 2015       434.80       -0.30       -0.07%

Canola Nov 2015       430.50       -0.60       -0.14%

 

Milling Wheat Dec 2014       227.00       +1.00       +0.44%

Milling Wheat Mar 2015       235.00       +1.00       +0.43%

Milling Wheat May 2015       238.00       +1.00       +0.42%

 

Durum Wheat Dec 2014       356.50       unch       0.00%

Durum Wheat Mar 2015       357.50       unch       0.00%

Durum Wheat May 2015       357.50       unch       0.00%

 

Barley Dec 2014       163.00       unch       0.00%

Barley Mar 2015       166.00       unch       0.00%

Barley May 2015       166.00       unch       0.00%

 

 

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

 

Chicago

Soybeans Jan 2015       1039       +18.5       +1.81%

Soybeans Mar 2015       1046       +18       +1.75%

Soybeans May 2015       1052.25       +17.75       +1.72%

Soybeans Jul 2015       1056.25       +17       +1.64%

Soybeans Aug 2015       1055.75       +16.25       +1.56%

Soybeans Sep 2015       1033.25       +14.5       +1.42%

 

Soybean Meal Dec 2014       378.4       +7.6       +2.05%

Soybean Meal Jan 2015       367.2       +7.9       +2.20%

Soybean Meal Mar 2015       354.9       +7.6       +2.19%

Soybean Oil Dec 2014       32.69       +0.02       +0.06%

Soybean Oil Jan 2015       32.8       +0.02       +0.06%

Soybean Oil Mar 2015       33       +0.01       +0.03%

 

Corn Dec 2014       372.75       -0.5       -0.13%

Corn Mar 2015       385.25       -1       -0.26%

Corn May 2015       394.25       -0.75       -0.19%

Corn Jul 2015       401.25       -1       -0.25%

Corn Sep 2015       407.5       -1       -0.24%

 

Oats Dec 2014       326.75       +1       +0.31%

Oats Mar 2015       326       -2.25       -0.69%

Oats May 2015       327.25       -2       -0.61%

Oats Jul 2015       326.25       -3.5       -1.06%

Oats Sep 2015       320.5       -4       -1.23%

 

Wheat Dec 2014       547.25       unch       0.00%

Wheat Mar 2015       553.5       +1       +0.18%

Wheat May 2015       560.5       +1.25       +0.22%

Wheat Jul 2015       566       +1.5       +0.27%

Wheat Sep 2015       574.5       +1.25       +0.22%

 

Minneapolis

Spring Wheat Dec 2014       583.25       -1.25       -0.21%

Spring Wheat Mar 2015       592       +0.5       +0.08%

Spring Wheat May 2015       600.25       +0.25       +0.04%

Spring Wheat Jul 2015       608       +0.25       +0.04%

Spring Wheat Sep 2015       616       +0.25       +0.04%

 

Kansas City

Hard Red Wheat Dec 2014       604       +1.75       +0.29%

Hard Red Wheat Mar 2015       607       +0.75       +0.12%

Hard Red Wheat May 2015       609.5       +0.75       +0.12%

Hard Red Wheat Jul 2015       608.75       -0.75       -0.12%

Hard Red Wheat Sep 2015       619.75       -0.75       -0.12%

 

 

About the author

D'Arce McMillan

Markets editor, Saskatoon newsroom

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