Funds were selling, taking profits and heading for the relative safety of U.S. treasuries on Thursday as markets increasingly focus on worries about weak economies and the Greek debt crisis.
Favourable weather in the U.S. Midwest also weakened crop futures.
Canola futures succumbed to the overall bearishness after pushing higher early in the day on buying by domestic processors and the export market.
The weaker Canadian dollar and worries about final canola acreage limited the fall.
July soybeans fell 1.3 percent but canola fell only 0.2 percent.
Saskatchewan Agriculture reported that 82 percent of the province’s crop had been seeded as of Monday. That is behind the five-year average of 92 percent but ahead of last year when only 73 percent of the crop was seeded.
The southeast remains furthest behind with only 44 percent seeded. Most spring-seeded crops are behind in development.
Heavy rain is forecast in this area on Friday and moderate rain over much of the province Friday and Saturday.
The Australian Bureau of Agricultural and Resource Economics and Sciences has forecast 2011-12 canola production at 2.3 million tonnes, up six percent from last year.
However, a plague of mice has damaged crops and some analysts believe production will a little less than forecast.
Because drought damaged the rapeseed crop in Europe, Australian canola should see good demand in the European Union.
The G-20 group of leading economic powers meets next week to talk about the global food supply and French president Nicolas Sarkozy is calling for more regulation of agricultural futures and a crack down on speculators he blames for wild swings in crop prices. He also wants a farm database that would gather and store market-sensitive information such as food stocks.
Canada’s finance minister Jim Flaherty told Reuters he is against the idea of stricter regulation.
Winnipeg (per tonne)
Canola Jul 11 $584.10, down $1.40
Canola Nov 11 $585.50, down $3.20
Canola Jan 12 $591.50, down $4.10
Canola Mar 12 $596.70, down $5.30
The previous day’s best basis narrowed to $7.60 under the July contract according to ICE Futures Canada in Winnipeg.
The July contract’s 14-day Relative Strength Index was 49. The rule of thumb is an RSI of 30 indicates an over sold market and 70 indicates an over bought market.
Western Barley Jul 11 $205, unchanged
Chicago (per bushel)
Soybeans Jul 11 $13.505, down 17.5 cents
Soybeans Aug 11 $13.50, down 14.75
Soybeans Nov 11 $13.5025, down 16.5
Corn Jul 11 $7.015, down 24.25
Corn Dec 11 $6.53, down 13.0
Oats Jul 11 $3.56, down 11.5
Oats Dec 11 $3.7275, down 12.25
Minneapolis (per bushel)
Spring Wheat Jul 11 $9.0025, down 36.75 cents
Spring Wheat Sep 11 $8.7775, down 18.25
Spring Wheat Dec 11 $8.805, down 14.75
Light crude oil nearby futures in New York rose 14 cents to $94.95 US per barrel.
The Canadian dollar at noon was $1.0160 US, down from $1.0225 the previous trading day. The U.S. dollar at noon was 98.43 cents Cdn.
The Toronto Stock Exchange composite index closed down 118,90 points, or 0.92 percent, at 12,853.13.
The Standard and Poor’s 500 index was up 2.21 points, or 0.17 percent, to close unofficially at 1,267.63.
