Crop futures closed higher Tuesday, supported by a surprise decrease in the U.S. corn ending stocks forecast and by concern about forecasts for hot weather in the U.S. Midwest.
Canola futures trailed gains in the Chicago soybean complex.
Prairie farmers are checking their rain gauges and fields after widespread and sometimes heavy rain over the past several days.
Crops will need warm dry conditions after large accumulations over the past several days in many areas. Lentils will particularly struggle in the wet weather. Generally, crop disease will grow in intensity and low areas could be flooded out.
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This morning’s U.S. Department of Agriculture monthly report slashed its estimate of Brazil’s 2015-16 corn crop to 70 million tonnes, down from 77.5 million in June and below an average of trade estimates for 73.9 million.
As Brazil had less corn to sell, the USDA raised its estimate of U.S. corn exports and that allowed it to drop its estimate of U.S. 2015-16 corn ending stocks to 1.701 billion bushels, from 1.708 billion in June, while analysts expected an increase.
The USDA raised its forecast of 2016-17 corn ending stocks to 2.081 billion bu., up from 2.008 billion in June but that was below an average of trade expectations for 2.205 billion.
The USDA’s average U.S. corn yield estimate was 168 bushels an acre. It was the highest yield ever in a July forecast.
Since 1993 when USDA began forecasting yields in July, 10 of those years had strong yield outlooks. In seven of those years USDA further increased the yield in subsequent reports and it three is dropped the yield, Reuters reported.
Although it could get very hot in a week or two, by then much of the corn crop will be finished pollinating.
In the crop report issued Monday, the USDA said 32 percent of the corn crop was silking, ahead of the five-year average of 26 percent.
The USDA’s soybean ending stock forecasts for old and new crop were in line with trade expectations.
But soybean futures rose with a forecast for hot weather in the Midwest later this month.
The market seems to swing daily over whether this heat wave will significantly stress soybeans or will rains provide enough soil moisture in the region to offset the heat stress.
Wheat futures rose on bargain buying and fund short-covering after last week’s multi year lows.
The USDA report raised the estimate of U.S. 2016 all-wheat production to 2.261 million bu., toward the high end of a range of trade estimates. Reuters reported.
Reflecting rising global use of wheat for livestock feed, the USDA cut its forecast of world 2016-17 wheat ending stocks to 253.7 million tonnes, down from 257.8 million in June and below the lowest in a range of trade expectations.
However, the global stocks figure, if realized, would still be the biggest on record.
Reuters reported that the wheat market also digested widely differing estimates of the French wheat harvest.
The French farm ministry’s first harvest forecast issued on Tuesday put soft wheat production at just under 37 million tonnes, while consultancy ODA Groupe slashed its estimate by 3 million tonnes to 32 million.
France is Europe’s largest wheat producer, but its problems with excess rain are partly offset by expected good crops in eastern Europe.
Light crude oil nearby futures in New York jumped $2.04 to US$46.80 per barrel.
The Canadian dollar at noon was US76.83 cents, up from 76.18 cents the previous trading day. The U.S. dollar at noon was C$1.3016.
The stronger crude price and views that the U.S. economy is building some momentum lifted stock markets. The S&P and the Nasdaq are at new record highs.
The Toronto Stock Exchange’s S&P/TSX composite index closed up 115.79 points, or 0.81 percent, at 14,477.67, its highest close since Aug. 5 last year.
The Dow Jones industrial average rose 120.74 points, or 0.66 percent, to 18,347.67; the S&P 500 gained 14.98 points, or 0.7 percent, to 2,152.14 and the Nasdaq Composite added 34.18 points, or 0.69 percent, to 5,022.82.
There was slight trade in ICE barley today and the contract closed lower. ICE milling wheat, durum did not trade but the exchange adjusted the price in milling wheat
Winnipeg ICE Futures Canada dollars per tonne
Canola Nov 475.40 +4.90 +1.04%
Canola Jan 482.00 +4.90 +1.03%
Canola Mar 487.80 +5.30 +1.10%
Canola May 492.20 +5.50 +1.13%
Canola Jul 495.90 +5.40 +1.10%
Milling Wheat Oct 2016 213.00 +3.00
Milling Wheat Dec 2016 217.00 +3.00
Durum Wheat Oct 2016 275.00 0.00
Durum Wheat Dec 2016 278.00 0.00
Barley Oct 2016 158.50 -1.50 -0.94%
Barley Dec 2016 158.50 -1.50
American crop prices in cents US/bushel, soybean meal in $US/short ton, soy oil in cents US/pound
Chicago
Soybeans Jul 2016 1107.25 +24.50 +2.26%
Soybeans Aug 2016 1102.25 +25.25 +2.34%
Soybeans Sep 2016 1092.75 +29.25 +2.75%
Soybeans Nov 2016 1087.00 +32.00 +3.03%
Soybeans Jan 2017 1086.50 +32.00 +3.03%
Soybeans Mar 2017 1067.50 +31.25 +3.02%
Soybean Meal Jul 2016 378.30 +4.60 +1.23%
Soybean Meal Aug 2016 378.70 +6.10 +1.64%
Soybean Meal Sep 2016 377.50 +7.30 +1.97%
Soybean Oil Jul 2016 30.71 +0.46 +1.52%
Soybean Oil Aug 2016 30.81 +0.48 +1.58%
Soybean Oil Sep 2016 30.94 +0.50 +1.64%
Corn Jul 2016 349.75 +6.00 +1.75%
Corn Sep 2016 352.25 +4.00 +1.15%
Corn Dec 2016 360.25 +4.75 +1.34%
Corn Mar 2017 368.75 +4.75 +1.30%
Corn May 2017 373.75 +4.25 +1.15%
Oats Jul 2016 236.50 unch 0.00%
Oats Sep 2016 206.75 +3.00 +1.47%
Oats Dec 2016 205.75 unch 0.00%
Oats Mar 2017 210.75 -1.00 -0.47%
Oats May 2017 215.25 -1.00 -0.46%
Wheat Jul 2016 424.00 +7.75 +1.86%
Wheat Sep 2016 438.50 +8.00 +1.86%
Wheat Dec 2016 461.00 +8.00 +1.77%
Wheat Mar 2017 479.50 +8.00 +1.70%
Wheat May 2017 491.25 +7.75 +1.60%
Minneapolis
Spring Wheat Jul 2016 487.75 unch 0.00%
Spring Wheat Sep 2016 502.50 +2.75 +0.55%
Spring Wheat Dec 2016 517.50 +2.75 +0.53%
Spring Wheat Mar 2017 532.25 +3.25 +0.61%
Spring Wheat May 2017 541.75 +3.25 +0.60%
Kansas
Hard Red Wheat Jul 2016 407.75 +6.75 +1.68%
Hard Red Wheat Sep 2016 423.00 +6.25 +1.50%
Hard Red Wheat Dec 2016 448.25 +6.50 +1.47%
Hard Red Wheat Mar 2017 465.00 +6.75 +1.47%
Hard Red Wheat May 2017 475.75 +7.00 +1.49%
Chicago livestock futures in US¢/pound
Live Cattle (P) Aug 2016 108.90 -0.45 -0.41%
Live Cattle (P) Oct 2016 108.90 -0.42 -0.38%
Live Cattle (P) Dec 2016 110.78 -0.09 -0.08%
Feeder Cattle (P) Aug 2016 138.60 -0.85 -0.61%
Feeder Cattle (P) Sep 2016 137.65 -0.70 -0.51%
Feeder Cattle (P) Oct 2016 136.60 -0.85 -0.62%
Lean Hogs (P) Jul 2016 79.95 +0.33 +0.41%
Lean Hogs (P) Aug 2016 79.17 +0.82 +1.05%
Lean Hogs (P) Oct 2016 67.75 -0.17 -0.25%
