Canola follows soybeans higher as soy cash market rises

Canola futures rose Wednesday but trailed soybeans that climbed two percent or more on strong cash markets, reduced farmer deliveries and rumours that China is again buying soybeans.

Canola futures were supported by the buying back of previously sold position. However, gains were limited by harvest and a rising Canadian dollar.

November canola closed at $608, up $6.20, or 1.03 percent.

Corn and wheat were also up on bargain buying that generated a mild recovery from the recent sell off.

• Canola was also supported by news from Malaysia that palm oil exports picked up in the first half of August compared to July. Slow exports last month pushed palm oil prices to a 10 month low.

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• Wheat was supported by word from Russian analyst SovEcon that if Russia keeps up its current pace of exports, its exportable surplus of 10-11 million tonnes of wheat could be used up by November.

Also, a Russian harvest report said that with 47 percent of the harvest complete, grain yields are down almost 29 percent from last year and wheat yields are down 30.5 percent.

• Crush margins at U.S. soybean processers are great as feeders scramble to find protein replacements for the reduced supply of dried distillers grain. The slowdown or temporary closure of several U.S. ethanol plants because of high corn prices has reduced the supply of DDGs.

• China’s National Grain and Oils Information Center pegs rapeseed output in that country at 12.2 million tonnes, down a little more than nine percent from last year.

The reduction is due to combination of lower acreage and lower yield.

As recently as June it had forecast a crop of 12.8 million tonnes.

The centre shaved 500,000 tonnes from its estimate of China’s corn crop in this monthly report, however at 197 million tonnes, the crop is 2.19 percent larger than last year.

Winnipeg (per tonne)

Canola Nov 12 $608.00, up $6.20 +1.03%

Canola Jan 13 $612.70, up $5.90 +0.97%

Canola Mar 13 $614.50, up $5.60 +0.92%

Canola May 13 $610.50, up $3.70 +0.61%

Milling Wheat Oct 12 $292.40, unchanged

Milling Wheat Dec 12 $298.00, unchanged

Milling Wheat Mar 13 $308.00, unchanged

Durum Wheat Oct 12 $299.20, unchanged

Durum Wheat Dec 12 $303.70, unchanged

Durum Wheat Mar 13 $310.30, unchanged

Barley Oct 12 $264.50, unchanged

Barley Dec 12 $269.50, unchanged

Barley Mar 13 $272.50 unchanged

Chicago (per bushel)

Soybeans (P) Sep 12 $16.5975, up 36.25 cents +2.23%

Soybeans (P) Nov 12 $16.345, up 36.5 +2.28%

Soybeans (P) Jan 13 $16.255, up 32.75 +2.06%

Soybeans (P) Mar 13 $15.41, up 23.75 +1.57%

Corn (P) Sep 12 $7.94, up 14.25 +1.83%

Corn (P) Dec 12 $8.04, up 15.0 +1.90%

Corn (P) Mar 13 $8.0425, up 13.0 +1.64%

Oats (P) Sep 12 $3.7625, up 7.75 +2.10%

Oats (P) Dec 12 $3.7625, up 7.75 +2.10%

Oats (P) Mar 13 $3.78, up 8.0 +2.16%

Minneapolis (per bushel)

Spring Wheat Sep 12 $9.135, up 10.75 cents +1.19%

Spring Wheat Dec 12 $9.235, up 9.75 +1.07%

Spring Wheat Mar 13 $9.32, up 9.75 +1.06%

Spring Wheat May 13 $9.3625, up 8.75 +0.94%

Nearby crude oil in New York closed at $94.33, up 90 cents.

The Bank of Canada’s noon rate for the loonie was $1.011 US, up from 1.0087 the day before.

The U.S. dollar was 98.91 cents Cdn.

In early tallies:

The Toronto Stock Exchange’s S&P/TSX composite index closed up 51.83 points, or 0.44 percent, at 11,905.44. That was its first finish above 11,900 points since July 7.

The Dow Jones industrial average dipped 8.13 points, or 0.06 percent, to 13,164.01.

The S&P 500 Index gained 1.50 points, or 0.11 percent, to 1,405.43.

The Nasdaq Composite added 13.95 points, or 0.46 percent, to 3,030.93.