Plunging crude oil, generally weak grain markets and a bearish Statistics Canada planting report drove canola down to the lowest price in five weeks.
January closed at $570.40, down $2.80.
November settled at $563.40, down $9.40.
The Stats Can report put canola seeded acreage at a record 19.8 million acres.
However, the farmer surveys that are the basis of the report may not fully reflect the amount of land that is flooded or too wet to seed.
The Canadian wheat estimates that between six and eight million acres will not be seeded in Western Canada. The question is, which crops will see the biggest acreage drop.
A chart of the major crop acreages from Stats Can accompanies this story.
Crop prices were generally hammered by liquidation in commodity markets as big funds continued to pull out of risk investments and park their money in the relative safety of U.S. treasuries.
Grains are under pressure as reports from Ukraine and Russia indicate their crops will be better than expected and they will be able to export more than had been assumed.
Weather in the U.S. Midwest is expected to be conducive to good crop development.
Corn initially fell hard, but the nearby contract bounced back on bargain buying. Traders are anticipating U.S. Department of Agriculture reports on acreage and stocks next Thursday.
Crude oil plunged after the International Energy Agency and the U.S. government said they would release 60 million barrels of crude oil from strategic reserves. The move is to drive down high energy prices that countries are blaming for holding back their economies.
The Canadian Wheat Board’s new crop 2011-12 Pool Return Outlook has wheat values that range from $7 per tonne lower to up $2. Durum values soared $79 per tonne for the top three milling grades.
The old crop 2010-11 PRO was little changed.
Winnipeg (per tonne)
Canola Jul 11 $570.40, down $2.80
Canola Nov 11 $563.40, down $9.40
Canola Jan 12 $569.90, down $9.80
Canola Mar 12 $575.20, down $10.60
The previous day’s best basis is $0 under the July contract according to ICE Futures Canada in Winnipeg.
The July contract’s 14-day Relative Strength Index was 38. The rule of thumb is an RSI of 30 indicates an over sold market and 70 indicates an over bought market.
Western Barley Jul 11 $205 unchanged
Chicago (per bushel)
Soybeans Jul 11 $13.1775, down 12.5 cents
Soybeans Aug 11 $13.16, down 15.0
Soybeans Nov 11 $13.1725, down 15.25
Corn Jul 11 $6.805, up 3.0
Corn Dec 11 $6.46, down 4.25
Oats Jul 11 $3.4875, down 3.25
Oats Dec 11 $3.6125, down 3.75
Minneapolis (per bushel)
Spring Wheat Jul 11 $8.44, down 16.5 cents
Spring Wheat Sep 11 $8.355, down 16.0
Spring Wheat Dec 11 $8.3825, down 14.25
Light crude oil nearby futures in New York fell $4.39 to $91.02.40 US per barrel.
The Canadian dollar at noon was $1.0205 US, down from $1.0284 the previous trading day. The U.S. dollar at noon was 97.9924 cents Cdn.
Stock markets were down sharply in the morning, but rebounded later on talk that the Greek government is near agreement with European lenders on an austerity program that is a requirement for getting a rescue loan program to cope with its massive debt.
The Toronto Stock Exchange composite index unofficially closed down 80.98 points, or 0.6 percent, at 12,979.58.
The Standard and Poor’s 500 index was down 3.63 points, or 0.28 percent, to finish unofficially at 1,283.51.
