Whiffs of worry whistled out of world markets Monday as both crop production prospects and general global peace seemed better than just a few days ago.
Lingering worries about weakening demand also relieved concerns about crop production prospects.
Canola on Winnipeg’s ICE Futures Canada exchange fell $6.60 per bushel for the November contract to $479.70.
Both American and British markets were closed for holidays Monday and Winnipeg volume was miniscule, although its contracts were open.
The biggest mellowing out factor for world markets was the decisive election victory in Ukraine of chocolate kingpin Petro Poroshenko Sunday. Russian president Vladimir Putin and his foreign minister have made semi-conciliatory statements about accepting the Ukrainian vote as legitimate, and Russian and Ukrainian energy ministers have worked with the European Union to develop a tentative natural gas deal that will lesson economic tensions.
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While animosity between the neighbours is still intense, and eastern Ukraine still in political ferment and some zones in rebellion and strife, the signs of de-escalation reassured markets that complete mayhem is not likely to occur.
This is bad for world crop prices since Ukraine is a major corn and wheat exporter. A risk premium has been built into prices in recent weeks and some of that premium is likely to evaporate if tensions die down.
Another worry-alleviating factor Monday was rain on the southern U.S. Plains over the weekend, reducing the extremity of drought problems there for the winter wheat crop. Wheat supplies look less in danger than feared.
Paris wheat and canola futures fell and Winnipeg canola futures did likewise. Winnipeg canola fell with an opening gap Monday as it did Friday.
European canola futures weakness was echoed by Malaysian palm oil weakness as markets sensed weaker than anticipated demand.
Winnipeg ICE Futures Canada dollars per tonne
Canola Jul 2014 480.90 -6.60 -1.35%
Canola Nov 2014 479.70 -6.10 -1.26%
Canola Jan 2015 484.20 -6.20 -1.26%
Canola Mar 2015 485.80 -6.20 -1.26%
Canola May 2015 487.30 -6.30 -1.28%
Milling Wheat Jul 2014 221.00 unch 0.00%
Milling Wheat Oct 2014 221.00 unch 0.00%
Milling Wheat Dec 2014 225.00 unch 0.00%
Durum Wheat Jul 2014 252.00 unch 0.00%
Durum Wheat Oct 2014 243.00 unch 0.00%
Durum Wheat Dec 2014 245.00 unch 0.00%
Barley Jul 2014 150.00 unch 0.00%
Barley Oct 2014 150.00 unch 0.00%
Barley Dec 2014 152.00 unch 0.00%
The Canadian dollar at noon was 92.13 cents US, up from 92 cents the previous trading day. The U.S. dollar at noon was $1.0854 Cdn.
The Toronto Stock Exchange’s S&P/TSX composite index closed up 7.59 points, or 0.05 percent, at 14,715.69. American markets were closed.
