Canola was little changed again on choppy trade, but closed slightly higher taking a little support from rising soybeans and soy oil.
Even though canola is undervalued compared to other oilseeds, prospects for a sustained rally are low because canola futures are mired in oversupply and a transportation system not up to the job of moving a record large crop.
Some short covering in canola and slightly higher palm oil were also at play as March canola edged up to close at $424.60, up $1.60.
Old crop soybeans rose, supported by strong export and domestic demand for U.S. soybeans but new crop dipped on expectation that South America will produce a record crop and that American soy acreage will increase.
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Pulse Weekly: Talk arises of India ending duty-free period
With harvest underway across the Canadian Prairies rumblings has been felt from the other side of the world, specifically in regards yellow peas. There have been recent media reports stating the Indian government is under growing domestic pressure to end its duty-free period on yellow pea imports.
New crop losses were limited by concern about temperatures of 38-40 C in Argentina’s soy growing region that could trim yield potential in that country.
A fire at a large European rapeseed crushing plant supported European meal prices. The plant can produce 20,000 to 30,000 tonnes of meal a month and it is not known how quickly it will be able to resume production.
The U.S. oilseed processors association said members crushed 165.384 million bushels of soybeans in December, topping market forecasts.
Pro Farmer Canada analyst Mike Jubinville told a crowd at CropSphere at Crop Production Week in Saskatoon Tuesday that soybean’s strength could fade quickly if China and other buyers start to cancel or delay orders from the U.S. once South America’s crop is harvested.
He said he expected canola futures would remain low for several more months, but the basis would start to improve later this year once the immediate backlog of crops get moved, however, the large carryouts of most crops will weigh on prices into 2014-15. He sees the canola carryout at t2.6-to-three million tonnes, up from 608,100 tonnes last year. The higher end of the range would be reached if the pace of domestic crush continues to lag.
Chicago wheat was down almost two percent today, weighed down by ample global supply. India’s agriculture minister today said the country is on track for a 100 million tonne wheat crop, up from about 92.5 million last year. The previous record was 94.9 million tonnes set in 2011-12.
Corn fell for a second day as the boost it got from the USDA report last week runs out of steam.
Chinese authorities have rejected more distillers’ dried grains, a corn by-product from the United States, due to the presence of an unapproved genetically modified strain, Reuters reported.
ICE Futures Canada wheat durum and barley contracts were untraded today. The exchange adjusted the barley contract down $9.50 per tonne yesterday and wheat up $1 a tonne.
Winnipeg ICE Futures Canada dollars per tonne
Canola Mar 14 424.60 +1.60 +0.38%
Canola May 14 434.00 +1.60 +0.37%
Canola Jul 14 442.70 +1.40 +0.32%
Canola Nov 14 456.60 +1.40 +0.31%
Canola Jan 15 462.90 +1.20 +0.26%
Milling Wheat Mar 14 183.00 0 unch
Milling Wheat May 14 189.00 0 unch
Milling Wheat Jul 14 191.00 0 unch
Durum Wheat Mar 14 243.00 unch
Durum Wheat May 14 247.00 unch
Durum Wheat Jul 14 248.00 unch
Barley Mar 14 127.00 0 unch
Barley May 14 129.00 0 unch
Barley Jul 14 129.00 0 unch
American crop prices in cents US/bushel, soybean meal in $US/short ton, soy oil in cents US/pound
Chicago
Soybeans Mar 14 1318.0 +11.0 +0.84%
Soybeans May 14 1297.5 +9.25 +0.72%
Soybeans Jul 14 1281.25 +8.5 +0.67%
Soybeans Aug 14 1238.25 +5.0 +0.41%
Soybeans Sep 14 1167.0 +1.25 +0.11%
Soybean Meal Mar 14 434.5 +4.4 +1.02%
Soybean Meal May 14 419.1 +3.7 +0.89%
Soybean Meal Jul 14 410.0 +3.2 +0.79%
Soybean Oil Mar 14 37.99 +0.23 +0.61%
Soybean Oil May 14 38.33 +0.23 +0.60%
Soybean Oil Jul 14 38.71 +0.24 +0.62%
Corn Mar 14 425.75 -5.75 -1.33%
Corn May 14 433.5 -6.0 -1.37%
Corn Jul 14 440.5 -5.75 -1.29%
Corn Sep 14 445.5 -5.5 -1.22%
Corn Dec 14 451.25 -4.75 -1.04%
Oats Mar 14 393.0 +2.75 +0.70%
Oats May 14 345.5 +0.5 +0.14%
Oats Jul 14 321.0 -2.25 -0.70%
Oats Sep 14 306.75 -0.5 -0.16%
Oats Dec 14 297.5 -1.25 -0.42%
Wheat Mar 14 567.75 -11.5 -1.99%
Wheat May 14 574.75 -11.5 -1.96%
Wheat Jul 14 581.25 -12.0 -2.02%
Wheat Sep 14 590.5 -12.25 -2.03%
Wheat Dec 14 603.25 -12.0 -1.95%
Minneapolis
Spring Wheat Mar 14 614.0 -7.0 -1.13%
Spring Wheat May 14 616.0 -8.0 -1.28%
Spring Wheat Jul 14 623.25 -8.5 -1.35%
Spring Wheat Sep 14 631.0 -8.0 -1.25%
Spring Wheat Dec 14 643.50 -9.25 -1.42%
Kansas City
KCBT Red Wheat Mar 14 620.5 -11.5 -1.82%
KCBT Red Wheat May 14 617.5 -11.25 -1.79%
KCBT Red Wheat Jul 14 615.5 -11.75 -1.87%
KCBT Red Wheat Sep 14 627.0 -12.25 -1.92%
KCBT Red Wheat Dec 14 640.75 -12.5 -1.91%
Light crude oil nearby futures in New York rose $1.58 to $94.17 US per barrel.
The Canadian dollar at noon was 91.47 cents US, little changed from 91.46 cents the previous trading day. The U.S. dollar at noon was $1.0933 Cdn.
Strong quarterly profit reports from major U.S. banks helped lift U.S. stock indexes to new highs. Some U.S. economic data showing stronger than expected results also supported stock prices.
Also, the World Bank raised its forecast for global growth thanks to gathering economic momentum in the world’s richest countries.
Global gross domestic product is expected to rise to 3.2 percent this year from 2.4 percent last year. In its last report, it expected growth to be three percent.
In early unofficial tallies —
The TSX composite closed up 80.19 points, or 0.59 percent at 13,772.58.
The Dow Jones industrial average rose 108.08 points or 0.66 percent, to close at 16,481.94.
The S&P 500 gained 9.50 points or 0.52 percent, to finish at 1,848.38.
The Nasdaq Composite rose 31.868 points or 0.76 percent, to end at 4,214.884, a record high.
