Crop futures, including canola, fell on better weather and worries about U.S. politicians’ inability to agree on a plan to raise the debt ceiling.
Canola was pressured by the forecast for generally warm weather this week, which should help push ahead crop maturity.
Crops in most of Alberta and Saskatchewan, except in southeastern Saskatchewan, look very good. The recent heat is helping delayed Manitoba crops to catch up.
The Canadian dollar climbed on Monday, also putting downward pressure on canola futures.
Declines in other oilseed markets, including European rapeseed, Malaysian palm and U.S. soy oil also pressured canola.
Heavy rain fell in many areas of the U.S. Midwest this weekend, helping to reduce the crop stress that last week’s heat wave caused.
Analysts are uncertain about the extent of the permanent damage caused by the heat.
The average of analysts’ opinions was that the corn good to excellent rating would fall two percentage points to 64 percent when the USDA released its weekly crop condition report this afternoon. It fell to 62 percent, so that should support prices when trading resumes.
The soybean good to excellent rating fell to 62 percent, one percentage point lower than the average of analysts’ expectations.
Outside markets were in a negative mood, with uncertainty about how U.S. politicians will solve their disagreement about cutting the deficit and raising the debt ceiling.
Democrats want a combination of spending cuts and increased tax revenue to address the deficit while Republicans want only spending cuts. There is also disagreement over the size of the debt ceiling increase, with Republicans wanting $1 trillion and the U.S. president wanting $2.4 trillion.
Winnipeg (per tonne)
Canola Nov 11 $551.90, down $9.00
Canola Jan 12 $560.10, down $8.90
Canola Mar 12 $567.30, down $9.10
Canola May 12 $572.40, down $8.80
The previous day’s best basis was one cent under the November contract according to ICE Futures Canada in Winnipeg.
The July contract’s 14-day Relative Strength Index was 35. The rule of thumb is an RSI of 30 indicates an over sold market and 70 indicates an over bought market.
Western Barley Oct 11 $205, unchanged
Chicago (per bushel)
Soybeans Aug 11 $13.655, down 14.75 cents
Soybeans Sep 11 $13.645, down 16.5
Soybeans Nov 11 $13.72, down 16.25
Corn Sep 11 $6.7875, down 11.25
Corn Dec 11 $6.745, down 11.0
Oats Sep 11 $3.515, down 1.5
Oats Dec 11 $3.635, down 1.5
Minneapolis (per bushel)
Spring Wheat Sep 11 $8.3075, down 7.75 cents
Spring Wheat Dec 11 $8.3375, down 8.0
Spring Wheat Mar 12 $8.4275, down 9.0
Light crude oil nearby futures in New York fell 67 cents to $99.20 US per barrel.
The Canadian dollar at noon was $1.0583 US, up from $1.0524 the previous trading day. The U.S. dollar at noon was 94.49 cents Cdn.
The Toronto Stock Exchange composite index closed down 58.68 points, or 0.43, percent, at 13,435.95.
The Standard & Poor’s 500 Index was down 7.59 points, or 0.56 percent, at 1,337.43.
