Canola falls 5 pct, as USDA raises soy, corn forecasts

Canola was caught in the downdraft of falling American crop futures after the USDA surprised the market, forecasting American yields and crop production well above the trade’s expectations.

Canola was also pressured as the loonie regained a penny against the U.S. dollar.

The USDA reported still respectable yields for the eastern cornbelt despite record rainfall in the early summer.

And forecasted yields in the western corn belt were exceptionally large, pushing total corn and soybean production well above where analysts expected.

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U.S. grains: Soybean futures hit one-month high on U.S.-China trade hopes

Chicago Board of Trade soybean futures hit their highest level in a month on Monday on renewed optimism over U.S.-China trade talks after U.S. President Donald Trump said he believed Beijing would agree to a soybean trade deal and will buy U.S. soy again.

Chicago corn futures fell nearly five percent to contract lows.

USDA forecast the third largest corn harvest in history, at 13.686 billion bushels with an average yield of 168.8 bu. per acre.

The production view was higher than all but one of the 26 analysts in a Reuters poll ahead of the report while the yield was higher than all pre-report estimates.

The trade on average expected 13.327 billion bu.

Coupled with steep declines in the previous session tied to China’s currency devaluation, corn’s two-day drop of 7.8 percent was the largest since July of 2013.

Soybean futures tumbled roughly six percent .

USDA pegged the U.S. soybean yield at 46.9 bu. per acre, 0.9 bu. above last month’s trend-based forecast and above the range of trade estimates.

USDA lowered its estimate of U.S. harvested area to 83.5 million acres, down one percent from June but still the highest on record. USDA projected soybean production at 3.916 billion bushels. The trade expected 3.724 billion.

USDA raised its forecast of U.S. 2015-16 soybean ending stocks to 470 million bu., up from 425 million in July and above a range of trade estimates.

USDA raised its forecast of global 2015/16 wheat ending stocks to 221.47 million tonnes, near the high end of trade expectations.

CBOT wheat posted the biggest daily declines while K.C. hard red winter and MGEX spring wheat futures posted contract lows in most months, with the spot contracts in K.C. and MGEX wheat hitting the lowest levels in five years.

Floods in several of Argentina’s key wheat-growing areas threaten to damage recently planted crops and could reduce the 2015-16 crop.

USDA pegged the 2015 U.S. durum crop at 77 million bu. The average trade expectation 80 million bu. Last years crop was 53 million.

Crude oil prices rose following Tuesday’s rout, while base metals sank to six-year lows on worries of waning demand from China, the world’s top metals buyer.

Light crude oil nearby futures in New York were up 22 cents to US$43.30 per barrel.

The Canadian dollar at noon was US77.08 cents, up from 76.06 cents the previous trading day. The U.S. dollar at noon was C$1.2973.

The Toronto Stock Exchange’s S&P/TSX composite index lost 75.14 points, or 0.52 percent, at 14,339.53. Of the index’s 10 main groups, seven ended lower.

The Dow Jones industrial average fell 0.33 points to 17,402.51, the S&P 500 gained 1.98 points, or 0.1 percent, to 2,086.05 and the Nasdaq Composite added 7.60 points, or 0.15 percent, to 5,044.39.

Winnipeg ICE Futures Canada dollars per tonne

Canola Nov 2015 481.60 -26.00 -5.12%

Canola Jan 2016 481.30 -25.20 -4.98%

Canola Mar 2016 480.80 -24.60 -4.87%

Canola May 2016 477.60 -23.80 -4.75%

Canola Jul 2016 473.10 -23.30 -4.69%

Milling Wheat Oct 2015 224.00 +2.00 +0.90%

Milling Wheat Dec 2015 224.00 +2.00 +0.90%

Milling Wheat Mar 2016 228.00 +2.00 +0.88%

Durum Wheat Oct 2015 370.00 unch 0.00%

Durum Wheat Dec 2015 380.00 unch 0.00%

Durum Wheat Mar 2016 395.00 unch 0.00%

Barley Oct 2015 207.10 -1.00 -0.48%

Barley Dec 2015 207.10 -1.00 -0.48%

Barley Mar 2016 209.10 -1.00 -0.48%

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

Chicago

Soybeans Aug 2015 951 -63 -6.21%

Soybeans Sep 2015 918.5 -62.5 -6.37%

Soybeans Nov 2015 910 -61.5 -6.33%

Soybeans Jan 2016 915.25 -60.75 -6.22%

Soybeans Mar 2016 914 -56.75 -5.85%

Soybeans May 2016 912 -51 -5.30%

Soybean Meal Aug 2015 335.9 -12 -3.45%

Soybean Meal Sep 2015 323.7 -18 -5.27%

Soybean Meal Oct 2015 314.6 -20 -5.98%

Soybean Oil Aug 2015 29.03 -1.05 -3.49%

Soybean Oil Sep 2015 29.1 -1.06 -3.51%

Soybean Oil Oct 2015 29.22 -1.04 -3.44%

Corn Sep 2015 357.25 -19.25 -5.11%

Corn Dec 2015 368 -19.5 -5.03%

Corn Mar 2016 379.75 -19 -4.76%

Corn May 2016 386.25 -18.5 -4.57%

Corn Jul 2016 391.5 -17.75 -4.34%

Oats Sep 2015 226.75 unch 0.00%

Oats Dec 2015 239.75 -0.25 -0.10%

Oats Mar 2016 252 +0.25 +0.10%

Oats May 2016 258.5 +0.25 +0.10%

Oats Jul 2016 259.5 +0.25 +0.10%

Wheat Sep 2015 492.25 -15 -2.96%

Wheat Dec 2015 497.25 -15 -2.93%

Wheat Mar 2016 503.75 -15.75 -3.03%

Wheat May 2016 509 -15.75 -3.00%

Wheat Jul 2016 512.5 -15.5 -2.94%

Minneapolis

Spring Wheat Sep 2015 509.5 -9.75 -1.88%

Spring Wheat Dec 2015 525.75 -9.5 -1.77%

Spring Wheat Mar 2016 542.5 -9.25 -1.68%

Spring Wheat May 2016 554 -9 -1.60%

Spring Wheat Jul 2016 564.75 -8.5 -1.48%

Kansas City

Hard Red Wheat Sep 2015 475.25 -12.75 -2.61%

Hard Red Wheat Dec 2015 496.5 -13 -2.55%

Hard Red Wheat Mar 2016 511 -12.75 -2.43%

Hard Red Wheat May 2016 521.5 -12.5 -2.34%

Hard Red Wheat Jul 2016 531.5 -12 -2.21%

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