Canola makes slight gain

Crop futures prices had a comfortably up day Thursday, with gains for virtually every crop, including a 10 cent per bushel increase for canola.

But it wasn’t a sharp gain, and the modest gains highlighted how little the September U.S. Department of Agriculture reports Wednesday have affected the market.

Winnipeg November canola futures rose $4.40 to $646.10.

Canola prices rose more than soybeans, mostly due to greater strength in vegetable oil prices compared to soybean meal prices.

Canola prices and demand are also benefiting from the widespread, continuing reports that farmers’ canola yields across the Prairies are disappointing. Some analysts are knocking down their estimate of canola production to 15 million tonnes and think the crop has bullish possibilities as buyers grapple with a suddenly shorter than expected crop.

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The wild wind storms on Wednesday are making some fear that many bushels of swathed canola have been lost.

The muted reaction to the USDA reports has followed numbers that don’t break any major expectations. Generally, the report tweaked a few numbers, but mostly confirmed the market’s existing opinion of the supply and demand situation.

Unlike the dullish day in grains and oilseeds, the world’s equity markets enjoyed a partylike atmosphere after U.S. Federal Reserve chair Ben Bernanke announced even more extreme manipulations of mortgage and stock markets in an attempt to preserve the economic “recovery.”

Bernanke said the Fed would buy about $40 billion per month of mortgage securities and would keep effective Fed interest rates at zero into mid-2015.

The purpose of the mortgage securities is to keep residential mortgage rates extremely low, thereby making home owning easier for people, taking the stress off indebted people and hopefully boosting the price of real estate.

The Fed also hopes to inflate stock market prices, which would revive the “wealth effect” that was lost to many people after the subprime meltdown in 2008.

Late Thursday the Standard and Poors Index was up more than two percent and smiles sat easily on bulls’ faces, with few plans to wipe them off any time soon.

Winnipeg (per tonne)

Canola Nov 12 $646.10, up $4.40 +0.69%

Canola Jan 13 $650.00, up $4.50 +0.70%

Canola Mar 13 $650.30, up $4.20 +0.65%

Canola May 13 $638.80, up $4.20 +0.66%

Milling Wheat Oct 12 $299.60, up $4.90 +1.66%

Milling Wheat Dec 12 $306.00, up $4.90 +1.63%

Milling Wheat Mar 13 $315.50, up $4.90 +1.58%

Durum Wheat Oct 12 $306.90, unchanged

Durum Wheat Dec 12 $311.40, unchanged

Durum Wheat Mar 13 $318.00, unchanged

Barley Oct 12 $250.00, unchanged