After a tumultuous week in commodity markets, canola prices ended the Friday session with a small rise in new crop months and a drop in old crop May futures.
Across the crop commodity spectrum, the knock-on weakness from slumping in silver, oil and gold that had hammered crop prices through the week seemed to have abated and perhaps ended.
Other commodities also stopped their overall decline Friday, with prices for most commodity classes see-sawing back and forth between small gains and small losses before closing to moderate losses in most.
Canola prices rose more than one percent Friday to close at $560.80 per tonne for the July contract and $556.70 for the November contract, increases respectively of $8.30 and $7.80.
September hard red spring wheat futures rose eight cents per bushel to $9.04 and oat December futures rose more than three cents per bu. to $3.55.
Corn futures fell sharply late in the Friday session, dropping 22 cents per bu. to $6.86 for the July contract and falling 15 cents per bu. to $6.40 for the December contract. However, soybeans rose about four cents in most contracts and winter wheat rose five to eight cents.
Gold, which had fallen from more than $1,550 per ounce at the beginning of May to $1,460 in the worst of the week’s rout, ended up around $1,500 in most futures contracts May 6, a gain of about $10.
Silver, which triggered the commodity slump, fell more Friday to slightly less than $35 per ounce in most contracts, a decline of less than four percent.
Silver prices experienced a stunning rise in the past 12 months, soaring from less than $20 to tickle $50. However, its slump to $35 in a week was even more dramatic, sparked by higher margin requirements at the Chicago Mercantile Exchange.
Oil also suffered in the sell-off, with Brent futures dropping during the week from $125 per barrel to a low of $105 in Friday intraday trade before recovering to about $110 late in the day, for a total daily loss of about one and a half percent.
Compared to the other commodity classes, crops held up well and have not necessarily turned long-term down, brokers said. Grains were the strongest commodity class Friday.
“(When speculators bail out), there are no buyers of silver, but there are always buyers in wheat, there are always buyers in crude,” said broker Ken Ball of Union Securities.
Ball said weather worries have been keeping crop futures firmer than the other commodity classes, something that should continue for a couple of weeks.
Errol Anderson of the Pro Market Wire report agreed but said that an absence of weather problems over the next two weeks could cause crop futures to slump.
“The grains are well supported with weather, but I think (the overall commodity slump) is a warning shot, and that the collapse in silver and crude is significant,” said Anderson.
“We could see a rebound, but once the tractors come fully into the field, if there’s any sort of normalcy, look out, this thing is going to go down.”
