Oilseed and grain futures fell Thursday, pressured lower by the falling stock market and worries about recession.
Several reports showed discouraging news on the economic front: more Americans joined the jobless line than the week before, U.S. mid-Atlantic states regional manufacturing slowed, Japanese monthly exports fell.
Worries are also rising about the health of European banks.
The U.S. and European economies are “dangerously close to recession,” Morgan Stanley economists wrote in a report.
Crude oil was sharply lower on the recession worry.
• Grains were further pressured by a forecast for rain in the U.S. Midwest and the northern part of the winter wheat belt.
• November canola closed at $553.50, down $4.10 or 0.74 percent. The loonie fell about 0.8 of a cent, helping to support the price of the oilseed. Canola held up better than the TSX composite, which fell more than three percent. The Dow fell about 3.7 percent.
• Dry weather is helping to advance Saskatchewan’s harvest.
Saskatchewan Agriculture today said three percent of the crop has been harvested, down from the five-year average of five percent.
However, harvest is proceeding more quickly than last year when only one percent was in the bin.
Twenty-one percent of the winter wheat, 30 percent of the fall rye, 11 percent of the lentils and 10 percent of the field peas have been combined. Twelve percent of the canola, six percent of the mustard, and one percent of the spring wheat, oats and barley has been swathed, Saskatchewan Agriculture said.
• Today and Friday will be cool on the Canadian Prairies, but hotter weather is forecast for the weekend and into the middle of next week. The extended forecast calls for the possibility of slightly below normal temperatures at the end of August.
• Elwynn Taylor, a meteorologist with Iowa State University Extension, thinks the U.S. corn yield is likely to average only 149 bushels per acre. That is four bushels an acre below the U.S. Department of Agriculture estimate released last week.
• Russia’s grain harvest is likely to top the official forecasted range of 85-90 million tonnes.
The head of the country’s weather forecasting service said production will likely exceed 90 million tonnes.
Excellent moisture means yields will likely exceed the five-year average.
Russia has been competing aggressively in international markets, putting downward pressure on wheat prices.
The country has harvested about 42 percent of the area sown to this year’s crop.
• Rain is forecast for Victoria and parts of southern New South Wales in Australia, supporting the outlook for a 26.2 million tonne wheat crop, about the same as last year. Last year’s big crop was hit by rain at harvest, knocking down the quality. Harvest is in late November.
Winnipeg (per tonne)
Canola Nov 11 $553.50, down $4.10
Canola Jan 12 $561.90, down $4.10
Canola Mar 12 $569.80, down $4.00
Canola May 12 $576.60, down $3.40
The previous day’s best basis was $10.01 under the November contract according to ICE Futures Canada in Winnipeg.
Western Barley Oct 11 $199, unchanged
Chicago (per bushel)
Soybeans Sep 11 $13.52, down 4.75 cents
Soybeans Nov 11 $13.61, down 5.75
Soybeans Jan 12 $13.7175, down 6.0
Corn Sep 11 $6.99, down 12.5
Corn Dec 11 $7.13, down 12.5
Oats Sep 11 $3.425, down 5.5
Oats Dec 11 $3.53, down 6.0
Minneapolis (per bushel)
Spring Wheat Sep 11 $9.1075, down 6.0 cents
Spring Wheat Dec 11 $8.9275, down 12.0
Spring Wheat Mar 12 $8.93, down 13.0
Light crude oil nearby futures in New York fell $5.20 to $82.38 US per barrel.
The Canadian dollar at noon was $1.0100 US, down from $1.0183 the previous trading day. The U.S. dollar at noon was 99.01 cents Cdn.
The Toronto Stock Exchange composite index unofficially ended down 392.90 points, or 3.12 percent, at 12,186.71,
The Standard & Poor’s 500 Index in a preliminary tally was down 53.15 points, or 4.45 percent, at 1,140.74.
