In an otherwise uneventful day in the crop futures markets, canola fell as soybeans sharply broke lower.
“If there wasn’t that aggressive Chinese buying, you’d see that (soybean price) reversal and say ‘The rally’s over,’ but you have to be cautious right now,” said Ken Ball, a broker with P.I. Financial.
Soybeans opened with a slight gap on the preceding close and immediately fell about 15 cents per bushel on the nearby contract, then bounced around at that level for the rest of the trading day.
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Soybean meal prices marked a key reversal, hitting a new contract high but then dropping below the previous session’s close, a chart pattern seen as particularly bearish. Soybean meal’s rally has been a powerful player in the strength of soybeans recently, so is that dynamic it truly over, it will worry traders.
Canola closed down $3.30 per tonne to $487.30 for the January contract and $2.80 to $497.20 for the March.
Most other crop futures were only a few cents per bushel off previous levels, but the vegoil crop markets are anxious because of heavy Chinese soybean purchases that are puzzling traders and commercial users.
Most believe the Chinese, who have now already purchased almost the entire amount of U.S. soybeans they are expected to buy this crop year, will have to stop soon, but the rate of exports has helped prices rally in recent weeks.
Thursday’s U.S. export sales report will be closely watched to see if there is a continuation of the mega-buying trend. Export inspection numbers today came in beneath trade expectations, suggesting Chinese buying could be pulling back.
South American weather continues to be good for that continent’s crops, which is negative for prices. One Brazilian analytical firm boosted its 2013-14 Brazil soybean production estimate to almost 90 million tonnes.
This week’s Statistics Canada final 2013 crop production numbers, issued Wednesday, will also be closely watched. Many traders and analysts believe the crop is about 17 million tonnes.
Winnipeg ICE Futures Canada dollars per tonne
Canola Jan 2014 487.30 -3.30 -0.67%
Canola Mar 2014 497.20 -2.80 -0.56%
Canola May 2014 505.70 -1.80 -0.35%
Canola Jul 2014 512.00 -1.40 -0.27%
Canola Nov 2014 518.20 unch 0.00%
Milling Wheat Dec 2013 211.00 -2.00 -0.94%
Milling Wheat Mar 2014 222.00 -2.00 -0.89%
Milling Wheat May 2014 234.00 unch 0.00%
Durum Wheat Dec 2013 247.00 unch 0.00%
Durum Wheat Mar 2014 253.00 unch 0.00%
Durum Wheat May 2014 257.00 unch 0.00%
Barley Dec 2013 152.00 unch 0.00%
Barley Mar 2014 154.00 unch 0.00%
Barley May 2014 155.00 unch 0.00%
American crop prices in cents US/bushel, soybean meal in $US/short ton, soy oil in cents US/pound
Chicago
Soybeans Jan 2014 1321.25 -15.25 -1.14%
Soybeans Mar 2014 1306 -11.75 -0.89%
Soybeans May 2014 1287.5 -10.25 -0.79%
Soybeans Jul 2014 1278.75 -9.25 -0.72%
Soybeans Aug 2014 1251.5 -7.5 -0.60%
Soybeans Sep 2014 1192.25 -4.25 -0.36%
Soybean Meal Dec 2013 447 -9.6 -2.10%
Soybean Meal Jan 2014 428.8 -7.8 -1.79%
Soybean Meal Mar 2014 418 -6.5 -1.53%
Soybean Oil Dec 2013 40.34 +0.12 +0.30%
Soybean Oil Jan 2014 40.6 +0.14 +0.35%
Soybean Oil Mar 2014 41 +0.14 +0.34%
Corn Dec 2013 416.5 +1.25 +0.30%
Corn Mar 2014 424.5 unch 0.00%
Corn May 2014 433 +0.25 +0.06%
Corn Jul 2014 440 unch 0.00%
Corn Sep 2014 446.25 -0.25 -0.06%
Oats Dec 2013 359.5 -5.75 -1.57%
Oats Mar 2014 324.5 -7 -2.11%
Oats May 2014 315 -1.75 -0.55%
Oats Jul 2014 312.75 -1 -0.32%
Oats Sep 2014 319.25 -1 -0.31%
Wheat Dec 2013 649.75 -5.25 -0.80%
Wheat Mar 2014 661.75 -7 -1.05%
Wheat May 2014 666.5 -7.25 -1.08%
Wheat Jul 2014 663.5 -7.25 -1.08%
Wheat Sep 2014 671 -7.5 -1.11%
Minneapolis
Spring Wheat Dec 2013 681.25 -5.5 -0.80%
Spring Wheat Mar 2014 702.5 -5 -0.71%
Spring Wheat May 2014 709 -4.25 -0.60%
Spring Wheat Jul 2014 715.5 -3 -0.42%
Spring Wheat Sep 2014 719.5 -2.5 -0.35%
Kansas City
KCBT Red Wheat Dec 2013 705 -8.25 -1.16%
KCBT Red Wheat Mar 2014 705.75 -3.5 -0.49%
KCBT Red Wheat May 2014 704.5 -3.75 -0.53%
KCBT Red Wheat Jul 2014 697.75 -2.75 -0.39%
KCBT Red Wheat Sep 2014 704.5 -3.5 -0.49%
Light crude oil nearby futures in New York rose $1.10 at $93.82 US per barrel.
The Canadian dollar at noon was 94.04 cents US, down from 94.35 cents the previous trading day. The U.S. dollar at noon was $1.0634 Cdn.
In unofficial tallies —
The Toronto Stock Exchange’s S&P/TSX composite index closed up 24.17 points, or 0.18 percent, at 13,419.57.
The Dow Jones industrial average dropped 77.64 points, or 0.48 percent, to end at 16,008.77.
The Standard & Poor’s 500 Index declined 4.91 points, or 0.27 percent, to 1,800.90.
The Nasdaq Composite Index fell 14.63 points, or 0.36 percent, to close at 4,045.26,
