Canola futures treated with casual disdain a perplexing and surprisingly bearish Statistics Canada finding on canola stocks Wednesday, rising in price while most other crop futures fell.
“It’s completely ignoring the stocks number,” said broker Ken Ball of Union Securities mid-session.
Canola rose $2.90 per tonne for the November contract to $571.30 and up $3.20 on the March to $589.80.
Down in Chicago soybean futures fell 2.5 cents to $14.11 per bushel for the nearby September contract, and down 1.75 cents for the November. Corn fell 10.25 cents for the September to $7.36.50 per bushel and down 7.75 cents to $7.48 for the December contract.
Nearby oats fell 7.5 cents per bushel to $3.55.25 per bushel and December oats fell 5.75 to $3.61.50. Minneapolis spring wheat futures fell 5.25 cents per bushel to $9.26.50.
But the positive performance for canola was shared by its vegetable oil buddy soyoil, which rose 0.63 cents per pound to 58.67 for the December futures contract.
Stock markets rocketed ahead Wednesday, regaining much of the losses of the past week. U.S. president Barack Obama’s hopes of $300 billion in new stimulus spending and continued commitment by central bankers around the world to flush the world with cheap money reignited recently extinguished hopes for renewed economic growth.
Crude oil futures leapt and gold fell, as greed overwhelmed fear momentarily.
The strong performance of canola futures Wednesday was attributed by some traders to canola’s relative cheapness compared to soybean oil, rather than any inherent fundamental strength. After all, harvesting conditions in Western Canada are excellent, the size of the crop is daily being upgraded by market players, and crushers will already be maxed-out this winter.
“We have an enormous canola crop coming in,” noted Ball.
The extra half-million tonnes of canola found by StatsCan to be in storage could have knocked the market, but the market didn’t seem to react.
“I think everyone’s wrestling with the canola number,” said FarmLink Marketing Solutions analyst Jon Driedger.
“On the surface it’s a bearish number, but the market’s trading higher.”
With traders’ attention turned to the new crop, revisions to old crop estimates have not had a major impact.
Winnipeg (per tonne)
Canola Nov 11 $571.30, up $2.90
Canola Jan 12 $580.80, up $3.00
Canola Mar 12 $589.80, up $3.20
Canola May 12 $596.10, up $3.20
Western Barley Oct 11 $215.00, unchanged
Chicago (per bushel)
Soybeans Sep 11 $14.1100, down 2.50 cents
Soybeans Nov 11 $14.2075, down 1.75
Soybeans Jan 12 $14.3150, down 0.75
Corn Sep 11 $7.3650, down 10.25
Corn Dec 11 $7.4800, down 7.75
Oats Sep 11 $3.5525, down 7.50
Oats Dec 11 $3.6150, down 5.75
Minneapolis (per bushel)
Spring Wheat Sep 11 $9.6425, down 6.75 cents
Spring Wheat Dec 11 $9.2650, down 5.25
Spring Wheat Mar 12 $9.2550, down 4.25
