Canola futures surged on Friday because of snow delaying the harvest in large parts of the Prairies, slow selling by farmers and expectations of export business with China.
With a significant amount of the crop still in swath, about one-third in Saskatchewan, concerns are rising about whether it will all get harvested.
The rally in Chicago soybeans also helped lift canola. The U.S. Department of Agriculture forecast a record U.S. soybean crop of 247.07 million tonnes, but that was a little less than what analysts had expected. There are also worries about frost damage to crops this weekend. November soybean futures settled up 28 cents at $9.64 US per bushel.
November canola settled at $382.30 per tonne, up $5.50 on volume of 6,541 contracts. January closed at $387.30, up $5.50 on a volume of 3,638 contracts.
Agriculture Canada released a new supply and demand report Oct. 8, based on the September Statistics Canada production report.
Agriculture Canada expects export and domestic demand will exceed production, causing the 2009-10 ending stocks number to fall to 750,000 tonnes, the smallest carry-out since 2003-04 and about half of what ending stocks were the previous two years.
The stronger loonie dampened canola’s rally.
At noon, one loonie was worth 95.9 cents US, up about a penny from Thursday. The U.S. dollar was at $1.0424, down from $1.0535 Cdn on Thursday.
The loonie rallied on a strong jobs report that lowed the unemployment rate to 8.4 percent in September from 8.7 percent in August.
Barley futures also rose. November closed at $151 per tonne, up 60 cents, and January closed at $157, up $1.10.
