Global growth worries overshadow USDA report bullish for oilseeds

The USDA on Tuesday cut its estimates of South American soybean production more than expected.

Initially all crop futures rose, but by the end of the day only canola closed higher after caution swept through markets generally, causing investors to back away from risk and put money into the relative safety of the U.S. dollar.

Most commodities fell as markets continued to worry about the weaker than expected U.S. jobs report issued Friday and a softer outlook from the International Monetary Fund, that warned weak global economic activity would weigh on commodity demand.

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U.S. soybean futures reached a 15-month high on Thursday after President Donald Trump’s administration said top-importer China agreed to buy tens of millions of tons of American crops in the next few years as part of a trade truce.

Oil prices fell after China, the world’s second largest oil consumer, reported reduced imports of crude oil in March.

Canola was able to hang to some of its early gains and closed higher, with support from exporter buying and some speculator buying. A weaker loonie also helped.

May canola closed at $625.20 per tonne, up $2.10. November closed at $585.00, up $1.70.

• USDA lowered its estimate of Brazil’s soybean crop to 66 million tonnes, from 68.5 million in its last monthly update. Last year it grew 75.5 million tonnes.

USDA pegged Argentina’s crop at 45 million tonnes, down from 46.50 million in the last forecast. Last year it grew 49 million tonnes.

U.S. 2011-12 soybean ending stocks were lowered to 250 million bu., down from 275 million in March and near the average trade estimate of 246 million.

• USDA’s forecast of year end U.S. corn stocks was 11 percent larger than expected. It left the number unchanged from last month at 801 million bushels. That is the still the smallest amount in 16 years but traders had expected a smaller number, given the small March 1 stocks number released just over a week ago.

USDA said feeders would substitute plentiful wheat for tight corn and also there will likely be an early harvest this year providing new crop corn supplies in the final weeks of 2011-12.

• USDA pegged U.S. year end wheat stocks at 793 million bushels, down from 825 million in its March estimate. That was about what traders expected.

World ending stocks of wheat were projected at 206.27 million tonnes, below trade estimates for 208.621 million tonnes. In March, USDA pegged world wheat ending stocks at 209.580 million tonnes.

• Oil World made a tentative forecast of European Union rapeseed production at 19.2 million tonnes, up only 100,000 tonnes from last year’s disappointing crop.

Significant areas suffered winter kill.

In 2010 the EU produced 21 million tonnes.

• The U.S. winter wheat crop as of April 8 was rated 61 percent good to excellent, up from 58 percent a week earlier. A year ago, wheat was only 36 percent good to excellent.

Winnipeg (per tonne)

Canola May 12 $625.20, up $2.10 +0.34%

Canola Jul 12 $620.20, up $0.80 +0.13%

Canola Nov 12 $585.00, up $1.70 +0.29%

Canola Jan 13 $589.00, up $1.60 +0.27%

The best basis for the previous day was +$2.40 over the May contract said Ice Futures Canada.

Western Barley May 12 $230.00, unchanged

Western Barley Jul 12 $230.00, unchanged

Milling Wht Oct 12 $265.30, down 6.70 -2.46%

Milling Wht Dec 12 $270.30, down 6.70 -2.42%

Milling Wht Mar 13 $275.30, down 6.70 -2.38%

Durum Wht Oct 12 $277.50, unchanged

Durum Wht Dec 12 $282.00, unchanged

Durum Wht Mar 13 $288.60, unchanged

Barley Oct 12 $186.50, unchanged

Barley Dec 12 $190.00, unchanged

Barley Mar 13 $191.50, unchanged

Chicago (per bushel)

Soybeans May 12 $14.26, down 5.0 -0.35%

Soybeans Jul 12 $14.2725, down 7.5 -0.52%

Soybeans Nov 12 $13.6475, down 17.25 -1.25%

Corn May 12 $6.3475, down 14.25 -2.20%

Corn Jul 12 $6.2575, down 15.5 -2.42%

Corn Dec 12 $5.435, down 6.75 -1.23%

Oats May 12 $3.34 -4.25 -1.26%

Oats Jul 12 $3.335 -3.5 -1.04%

Oats Dec 12 $3.35 -6.75 -1.98%

Minneapolis (per bushel)

Spring Wht May 12 $8.3375, down 13.25 cents -1.56%

Spring Wht Jul 12 $8.28, down 12.5 -1.49%

Spring Wht Sep 12 $8.145, down 11.75 -1.42%

Spring Wht Dec 12 $8.045, down 10.25 -1.26%

The nearby New York light sweet crude contract fell $1.44 to $101.02.

The Canadian dollar at noon dropped below par to 99.72 cents US, down from $1.0028 the previous trading day. The U.S. dollar at noon was $1.0028 Cdn.

The Toronto Stock Exchange’s S&P/TSX composite index unofficially closed down 83.21 points, or 0.69 percent, at 11,935.29.

The Dow Jones industrial average was down 202.76 points, or 1.57 percent, at 12,726.83.

The Standard & Poor’s 500 Index was down 20.50 points, or 1.48 percent, at 1,361.70.

The Nasdaq Composite Index was down 49.84 points, or 1.64 percent, at 2,997.24.

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