Crop prices, including canola, fell sharply on Friday, driven down by a report showing slow U.S. exports and larger than expected global grain supply.
The United States Department of Agriculture today increased its forecast of the size of U.S. ending stocks of soybeans, wheat and corn, due mostly to slow exports.
It also raised its assessment of the size of the global wheat and corn crops.
January Canola closed at $499.50 per tonne, down $11.10 or 2.17 percent.
The drop today more than offset gains earlier this week and the contract fell $2.80 in total this week.
Oilseeds had been rising on developing dry weather in South America.
• Losses were limited by a positive reaction to the meeting of European leaders called to address the debt crisis.
• USDA increased its domestic soybean year end stocks forecast by almost 13 percent, wheat rose by six percent and corn by a modest 0.6 percent.
• Wheat prices at first fell on the USDA report but then bargain hunters stepped in. Deferred spring wheat contracts actually rose slightly. The increase in U.S. wheat ending stocks was limited to winter wheat. Spring wheat and durum ending stocks stayed the same.
• Looking at the world numbers, USDA increased global corn production by 8.53 million tonnes to 867.52 million, due mostly to an upward revision in China’s production. It also raised its year end global corn stocks forecast but the number is still smaller than last year.
USDA increased its estimate of world wheat production, raising its forecasts for Australia, Argentina and Canada. USDA also revised upward Australia’s carry in stocks.
Global wheat production is now estimated at a record 688.97 million tonnes, up from 683.3 million last month.
Year end global wheat stocks for 2011-12 rose to 208.52 million from 202.6 million last month. That is an increase of 8.77 million tonnes over 2010-11.
• The Canadian Oilseed Processors Association said members crushed 131,475 tonnes of canola to Dec. 7, down a little over one percent from the week before. That represented a capacity use of 89.6 percent.
Winnipeg (per tonne)
Canola Jan 12 $499.50, down 11.10 (-2.17%)
Canola Mar 12 $500.60, down 9.90 (-1.94%)
Canola May 12 $504.30, down 9.00 (-1.75%)
Canola Jul 12 $507.40, down 8.30 (-1.61%)
The previous day’s best basis was $6.62 under the January contract, said ICE Canada Winnipeg.
The January contract’s 14-day Relative Strength Index was 36.
Western Barley Dec 11 $217.00, unchanged
Chicago (per bushel)
Soybeans Jan 12 $11.07, down 25.5 cents (-2.25%)
Soybeans Mar 12 $11.165, down 25.75 (-2.25%)
Soybeans May 12 $11.27, down 25.5 (-2.21%)
Corn Dec 11 $5.855, down 4.5 (-0.76%)
Corn Mar 12 $5.9425, down 6.0 (-1.00%)
Oats Dec 11 $3.00, up 5.0 (+1.69%)
Oats Mar 12 $3.02, unchanged
Minneapolis (per bushel)
Spring Wheat Dec 11 $8.43, down 1.75 cents (-0.21%)
Spring Wheat Mar 12 $8.2725, up 6.0 (+0.73%)
Spring Wheat May 12 $8.09, up 6.25 (+0.78%)
Nearby light crude oil in New York rose $1.07 cents to settle at $99.41 a barrel.
The Canadian dollar at noon was 98.03 cents US, down from 98.11 the previous trading day. The U.S. dollar at noon was $1.0201 Cdn.
North American stock exchanges buoyed by developments at the European debt crisis talks and by a Reuters report that China planned a new $300 billion vehicle to invest in Europe and the United States.
All but one of the 27 nations in the European Union agreed to pursue tighter integration with stricter budget discipline in the euro zone. Britain was the holdout.
The Toronto Stock Exchange composite closed up 82.96 points, or 0.69 percent, at 12,034.75.
The Standard and Poor’s 550 was up 20.61 points, or 1.67 percent, to finish unofficially at 1,254.96.
For the week, the TSX composite fell 0.3 percent, the Dow rose 1.4 percent, the S&P 500 was up 0.9 percent and the Nasdaq rose 0.8 percent.
