March canola gains $10.90 on week thanks to weak loonie

Reading Time: 4 minutes

Published: January 23, 2015

,

The weak loonie continued to support canola futures Friday while stronger than expected weekly export sales lifted corn.

The weak loonie makes Canadian canola seed, oil and meal more attractive than American soy products and that has been supporting canola futures this week.

March canola closed the week at $461.50 percent, down 70 cents on the day but up $10.90 over the week.

May canola closed at $455.60, up $2.20 on the day and up $9.20 on the week.

March canola was up 2.4 percent during the week while March soybeans fell 1.9 percent. For the week, soymeal was up 1.4 percent and soyoil was down 5.3 percent.

Read Also

Photo: Greg Berg

U.S. grains: Chicago wheat futures dip on global supply pressure; corn, soybeans fall

Chicago | Reuters – Chicago Board of Trade wheat futures fell on Friday and notched a weekly loss, as plentiful…

The loonie fell 0.2 cent today but was down 2.8 cents from last Friday, with weakness stemming from a surprise cut in the Bank of Canada lending rate and weakness in crude oil values.

Canola today was also supported by new export business and speculative buying.

Trading volume is shifting to the May contract.

Today there were more than 11,000 trades in May and 9,635 trades in March.

Some canola buyers are already using the May contract to calculate their cash and basis bids.

There appears to be fairly wide basis for nearby delivery but much narrower basis for delivery this spring.

Analyst John DePape in a posting at www.agriville.com noted today that the inverse between March and May canola contracts is not due to tight stocks in the system. It is more associated with reduced threat of delivery on the nearby contract.

In other news, Canadian crushers are scaling up to take advantage of the weaker loonie, even as canola futures rise.

The Canadian Oilseed Processors Association said members crushed 153,102 tonnes of canola in the week ending Jan. 21, up 5.3 percent from the week before and a six month high.

That represented a capacity use of 83.8 percent, exceeding the cumulative rate of 81.2 percent so far this crop year.

Despite the strong American buck, weekly export sales of U.S. corn were a robust 2.19 million tonnes, topping analysts’ forecasts that ranged from 800,000 to one million tonnes.

It was the strongest sales in a single week in seven years. That helped corn edge up today but over the week the nearby contract dipped 0.1 percent.

It was the opposite situation in soybeans, where export sales totaled only 115,300 tonnes, below forecasts ranging from 400,000 to 700,000 tonnes.

Analysts expect international buyers will start to switch to South American supplies as they become available.

Wheat export sales totaled 564,400 tonnes, beating trade expectations.

That helped to lift Minneapolis spring wheat futures slightly but Kansas hard red winter and Chicago soft red winter were lower.

For the week, the front-month CBOT soft red winter wheat contract shed 0.7 percent, its fifth straight week of losses.

Hard red winter wheat dropped 2.5 percent this week and Minneapolis spring wheat was 1.5 percent lower.

The rising U.S. dollar weighs on U.S. commodities generally.

The euro fell to fresh 11-year lows against the dollar on Friday following the European Central Bank’s announcement on Thursday that it would pump a trillion euros into the euro zone economy to revive sagging growth and ward off deflation.

Light crude oil nearby futures in New York were down 72 cents to US$45.59 per barrel.

The Canadian dollar at noon was US80.63 cents, down from US80.83 cents the previous trading day. The U.S. dollar at noon was C$1.2403.

The Toronto Stock Exchange’s S&P/TSX composite index closed up 15.37 points, or 0.1 percent, at 14,779.35.

The Dow Jones industrial average fell 141.38 points, or 0.79 percent, to 17,672.6, the S&P 500 lost 11.33 points, or 0.55 percent, to 2,051.82 and the Nasdaq Composite added 7.48 points, or 0.16 percent, to 4,757.88.

For the week, the TSX climbed 3.3 percent, the Dow rose 0.9 percent, the S&P 500 added 1.6 percent and the Nasdaq gained 2.7 percent. It was the first positive week for major indexes in the last four.

 

Winnipeg ICE Futures Canada dollars per tonne

Canola Mar 2015       461.50       -0.70       -0.15%

Canola May 2015       455.60       +2.20       +0.49%

Canola Jul 2015       448.90       +1.60       +0.36%

Canola Nov 2015       436.10       -0.70       -0.16%

Canola Jan 2016       438.00       -0.10       -0.02%

 

Milling Wheat Mar 2015       220.00       unch       0.00%

Milling Wheat May 2015       223.00       unch       0.00%

Milling Wheat Jul 2015       226.00       +1.00       +0.44%

 

Durum Wheat Mar 2015       363.00       unch       0.00%

Durum Wheat May 2015       353.00       unch       0.00%

Durum Wheat Jul 2015       343.00       unch       0.00%

 

Barley Mar 2015       195.00       unch       0.00%

Barley May 2015       197.00       unch       0.00%

Barley Jul 2015       199.00       unch       0.00%

 

American crop prices in cents US/bushel, soybean meal in $US/short ton, soy oil in cents US/pound

 

Chicago

Soybeans Mar 2015       972.75       -4       -0.41%

Soybeans May 2015       979.5       -3.5       -0.36%

Soybeans Jul 2015       985.25       -3.5       -0.35%

Soybeans Aug 2015       985.5       -3.25       -0.33%

Soybeans Sep 2015       971       -2.25       -0.23%

Soybeans Nov 2015       959.75       -1.25       -0.13%

 

Soybean Meal Mar 2015       331.5       +1.4       +0.42%

Soybean Meal May 2015       323.7       +1.1       +0.34%

Soybean Meal Jul 2015       321.9       +0.7       +0.22%

 

Soybean Oil Mar 2015       31.6       -0.37       -1.16%

Soybean Oil May 2015       31.79       -0.37       -1.15%

Soybean Oil Jul 2015       31.99       -0.36       -1.11%

 

Corn Mar 2015       386.75       +3       +0.78%

Corn May 2015       395.25       +3.25       +0.83%

Corn Jul 2015       402.75       +3.5       +0.88%

Corn Sep 2015       409.25       +4       +0.99%

Corn Dec 2015       417.25       +4       +0.97%

 

Oats Mar 2015       290.5       -0.5       -0.17%

Oats May 2015       294       -0.75       -0.25%

Oats Jul 2015       298.25       -1       -0.33%

Oats Sep 2015       300.5       -0.5       -0.17%

Oats Dec 2015       296.25       -2       -0.67%

 

Wheat Mar 2015       530       -3.75       -0.70%

Wheat May 2015       532.75       -4.5       -0.84%

Wheat Jul 2015       536.5       -4.25       -0.79%

Wheat Sep 2015       544.25       -4.25       -0.77%

Wheat Dec 2015       555.75       -4.5       -0.80%

 

Minneapolis

Spring Wheat Mar 2015       576       +0.5       +0.09%

Spring Wheat May 2015       582.5       +0.75       +0.13%

Spring Wheat Jul 2015       590.75       +0.5       +0.08%

Spring Wheat Sep 2015       598.5       +0.75       +0.13%

Spring Wheat Dec 2015       608       +0.25       +0.04%

 

Kansas City

Hard Red Wheat Mar 2015       564       -0.75       -0.13%

Hard Red Wheat May 2015       569       -0.5       -0.09%

Hard Red Wheat Jul 2015       572.25       -0.75       -0.13%

Hard Red Wheat Sep 2015       583.75       -0.5       -0.09%

Hard Red Wheat Dec 2015       598       -0.5       -0.08%

 

 

About the author

D'Arce McMillan

Markets editor, Saskatoon newsroom

Markets at a glance

explore

Stories from our other publications