Old crop canola jumps higher on tight stocks despite bearish USDA report

With road bans and the arrival of seeding, farmers are not delivering canola and that helped drive old crop prices higher on a generally down day in agriculture markets.

Old crop canola gain of $11.70 a tonne also benefited from a sharp decline in the Canadian dollar.

New crop canola months edged lower on a slightly bearish USDA report and on good seeding weather.

For the week, July canola rose $7.10 per tonne and November fell $5.70.

The tight stocks and reduced deliveries are making themselves felt at the user level.

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Agriculture and Agri-Food Canada made several upward adjustments to its supply and demand estimates, after including the data from the Statistics Canada production update earlier this month.

The Canadian Oilseed Processors Association said only 93,508 tonnes of canola were crushed in the week ending May 8, down almost 19 percent from the week before. That represents a capacity use of only 56.2 percent.

The Canadian Grain Commission weekly grain handling summary said only 122,500 tonnes of canola were delivered in the week ending May 5, down from 164,000 tonnes the week before and 165,400 the week before that.

Stocks of canola in elevators, process elevators, ports and in transit were 891,3000 tonnes, down from 1.008 million the week before and down from 1.010 last year at the same time.

Corn fell about two percent on Friday after the USDA forecast a 2013-14 record corn crop of 14.14 billion bushels.

USDA sees total supply at 14.924 billion bu. (10.78 billion in 2012-13), total use at 12.92 billion bu. (11.135 billion 2012-13) and ending stocks rising to two billion bu. (0.759 billion 2012-13)

The new crop ending stocks number was above traders’ expectations.

USDA forecast a corn yield of 158 bu. per acre, down from earlier predictions due to late seeding but still well above last year’s drought-reduced 123.4.

The yield forecast was down 5.6 bu., or three percent, from a projection made at USDA’s Outlook Forum in February.

USDA forecasts a corn price of $4.30-$5.10 per bu. in 2013-14, down from $6.70-$7.10 for the current year.

USDA projected soybean production of 3.39 billion bu. (3.015 billion in 2012-13) total use of 3.264 billion bu. (3.080 billion in 2012-13) and ending stocks of 265 million bu. (125 million in 2012-13).

Traders on average had expected stocks of 236 million bu. Stocks would be the largest in seven years.

It forecast a soybean price of $9.50-$11.50, down from $14.30 of 2012-13.

But there was good news for canola, which in most years tends to be strongly influenced by soybean oil values. USDA sees 2013-14 ending stocks falling slightly.

It forecast a soy oil price of 47-51 cents per pound, little changed from the 2012-13 value of 49 cents.

USDA pegged the U.S. winter wheat crop at 1.486 billion bu., down 10 percent from 2012. The average of analysts’ pre-report estimates was 1.497 billion.

Of that, it forecast hard red winter wheat production at 768 million bu., down 23 percent from last year. The average of analysts’ pre-report estimates was 776 million.

Soft red wheat was 500.901 million bu., up from 419.801 million in 2012.

Soft white was 205.441 million bu. down a little from last year.

Hard white was 11.388 million bu., down a little.

Wheat futures were pressured by USDA’s forecast of bigger wheat crops in all of the world’s major exporting nations except in the U.S. It pegged global wheat production at a record 701.1 million tonnes, up seven percent. Europe and the former Soviet states would see the largest increases.

Global wheat ending stocks are seen rising by three percent.

We will have analysis of the USDA report in the May 16 Western Producer markets section.

Winnipeg ICE Futures Canada dollars per tonne

Canola May 2013 648.50 +11.70 +1.84%

Canola Jul 2013 618.50 +11.70 +1.93%

Canola Nov 2013 535.60 -1.20 -0.22%

Canola Jan 2014 536.60 -0.50 -0.09%

Canola Mar 2014 532.10 -0.50 -0.09%

Milling Wheat May 2013 292.00 unch 0.00%

Milling Wheat Jul 2013 294.00 unch 0.00%

Milling Wheat Oct 2013 294.00 unch 0.00%

Durum Wheat May 2013 301.90 unch 0.00%

Durum Wheat Jul 2013 301.90 unch 0.00%

Durum Wheat Oct 2013 294.90 unch 0.00%

Barley May 2013 243.50 unch 0.00%

Barley Jul 2013 244.00 unch 0.00%

Barley Oct 2013 194.00 unch 0.00%

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

Chicago

Soybeans May 2013 1488.25 -3 -0.20%

Soybeans Jul 2013 1399 -9.75 -0.69%

Soybeans Aug 2013 1330 -10 -0.75%

Soybeans Sep 2013 1254.25 -10 -0.79%

Soybeans Nov 2013 1205.5 -13.5 -1.11%

Soybeans Jan 2014 1212.75 -13.5 -1.10%

Soybean Meal May 2013 444.3 +4.2 +0.95%

Soybean Meal Jul 2013 406.8 -6.4 -1.55%

Soybean Meal Aug 2013 383.8 -3.9 -1.01%

Soybean Oil May 2013 49.17 +0.1 +0.20%

Soybean Oil Jul 2013 49.23 +0.01 +0.02%

Soybean Oil Aug 2013 49 +0.03 +0.06%

Corn May 2013 687.75 -6.75 -0.97%

Corn Jul 2013 636.25 -12.5 -1.93%

Corn Sep 2013 554.5 -11.5 -2.03%

Corn Dec 2013 529.5 -12 -2.22%

Corn Mar 2014 540 -11.5 -2.09%

Oats May 2013 409 -4 -0.97%

Oats Jul 2013 378.5 -4 -1.05%

Oats Sep 2013 366.75 -3.75 -1.01%

Oats Dec 2013 357.5 -3 -0.83%

Oats Mar 2014 361.5 -3.75 -1.03%

Wheat May 2013 696.75 -19.5 -2.72%

Wheat Jul 2013 704.25 -19.25 -2.66%

Wheat Sep 2013 712.5 -19 -2.60%

Wheat Dec 2013 730 -18.25 -2.44%

Wheat Mar 2014 747 -16.5 -2.16%

Minneapolis

Spring Wheat May 2013 857.75 unch 0.00%

Spring Wheat Jul 2013 808.75 -16.75 -2.03%

Spring Wheat Sep 2013 804.75 -16.5 -2.01%

Spring Wheat Dec 2013 812.25 -16.5 -1.99%

Spring Wheat Mar 2014 823.25 -17 -2.02%

Kansas City

KCBT Red Wheat May 2013 771.5 -20.5 -2.59%

KCBT Red Wheat Jul 2013 758.75 -20.5 -2.63%

KCBT Red Wheat Sep 2013 767 -20.5 -2.60%

KCBT Red Wheat Dec 2013 784.5 -20.5 -2.55%

KCBT Red Wheat Mar 2014 797.75 -20.25 -2.48%

Light crude oil nearby futures in New York were down 35 cents at $96.04 US per barrel.

The Canadian dollar at noon was 98.78 cents US, down almost a penny from 99.73 cents the previous trading day. The U.S. dollar at noon was $1.0124 Cdn.

The U.S. buck soared against most currencies, propelled by Thursday’s better-than-expected jobless claim figures.

Statistics Canada reported April’s unemployment rate was unchanged at 7.2 per cent, as the economy added 12,500 new jobs, but analysts had expected 15,000 jobs.

In unofficial tallies —

The Toronto Stock Exchange’s S&P/TSX composite index ended the session up 45.19 points, or 0.36 percent, at 12,589.09.

The Dow Jones industrial average gained 35.87 points, or 0.24 percent, to 15,118.49.

The Standard & Poor’s 500 Index rose 7.01 points, or 0.43 percent, to 1,633.68.

The Nasdaq Composite Index climbed 27.41 points, or 0.80 percent, to 3,436.58.

For the week, the TSX index climbed 1.2 percent, the Dow rose almost one percent on the week, the Nasdaq rose 1.7 percent and the S&P 500 rose 1.2 percent.