Outlook for big U.S. crops pressures canola lower

By D’Arce McMillan

Saskatoon newsroom

The prospect of bumper American soybean and corn crops kept canola futures on the defensive on Wednesday.

The November contract closed at $450.60, down $6.70 or about 1.5 percent.

The little traded, soon to expire July contract rose $2.30 to $489.60. Crushers are pricing based on the November contract.

In Canada, analysts are trying to measure the damage from the heavy weekend rain and flooding on crops in the eastern Prairies. Crop development is also behind schedule and several weather models predict a cooler than normal summer.

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U.S. grains: Soybeans rise on China demand hopes; corn and wheat rebound

Chicago Board of Trade soybean, corn and wheat futures rose on Monday on signs of progress towards the end of a record-long U.S. government shutdown, along with expectations of a revival of U.S. soybean exports to China, analysts said.

There is some hope though in that the temperature outlook for the next two weeks is for warm weather.

Oilseeds have been under pressures since the United States Department of Agriculture on Monday said that American growers had seeded 84.8 million acres to soybeans, a record and well above the average of traders’ expectations.

Midwest weather is generally favourable to crops and that also pressured soybeans. The weather also pushed corn lower.

Chicago wheat edged higher on bargain buying, but Kansas hard red winter and Minneapolis hard red spring wheat fell.

India’s monsoon rain in June was 43 percent below average, but the prospect for July and August is better. The slow onset of the monsoon has caused Indian farmers to delay planting.

At the end of July about 32.4 million acres had been seeded, just over half of the level at the same point last year.

Winnipeg ICE Futures Canada dollars per tonne

Canola Jul 2014 489.60 +2.30 +0.47%

Canola Nov 2014 450.60 -6.70 -1.47%

Canola Jan 2015 454.50 -5.70 -1.24%

Canola Mar 2015 455.50 -5.20 -1.13%

Canola May 2015 455.20 -4.60 -1.00%

Milling Wheat Jul 2014 190.00 -4.00 -2.06%

Milling Wheat Oct 2014 191.00 -4.00 -2.05%

Milling Wheat Dec 2014 195.00 -4.00 -2.01%

Durum Wheat Jul 2014 239.00 unch 0.00%

Durum Wheat Oct 2014 230.00 unch 0.00%

Durum Wheat Dec 2014 232.00 unch 0.00%

Barley Jul 2014 125.00 unch 0.00%

Barley Oct 2014 132.50 unch 0.00%

Barley Dec 2014 134.50 unch 0.00%

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

Chicago

Soybeans Jul 2014 1392.5 -7.5 -0.54%

Soybeans Aug 2014 1314.75 -13 -0.98%

Soybeans Sep 2014 1180.25 -3.5 -0.30%

Soybeans Nov 2014 1141.5 -6 -0.52%

Soybeans Jan 2015 1149.75 -5.75 -0.50%

Soybeans Mar 2015 1158 -5.25 -0.45%

Soybean Meal Jul 2014 452.3 -3.8 -0.83%

Soybean Meal Aug 2014 426.7 -3.3 -0.77%

Soybean Meal Sep 2014 390.3 +0.2 +0.05%

Soybean Oil Jul 2014 38.47 -0.4 -1.03%

Soybean Oil Aug 2014 38.57 -0.4 -1.03%

Soybean Oil Sep 2014 38.65 -0.43 -1.10%

Corn Jul 2014 418.5 -4.25 -1.01%

Corn Sep 2014 412.25 -3.75 -0.90%

Corn Dec 2014 418 -4.75 -1.12%

Corn Mar 2015 429.25 -5 -1.15%

Corn May 2015 436.75 -4.75 -1.08%

Oats Jul 2014 366.75 +20.75 +6.00%

Oats Sep 2014 346.75 +10 +2.97%

Oats Dec 2014 342 +10 +3.01%

Oats Mar 2015 333.5 +7.75 +2.38%

Oats May 2015 326.75 +6 +1.87%

Wheat Jul 2014 561.75 +2 +0.36%

Wheat Sep 2014 575.5 +3 +0.52%

Wheat Dec 2014 598.25 +3.25 +0.55%

Wheat Mar 2015 621.75 +4 +0.65%

Wheat May 2015 637 +5.25 +0.83%

Minneapolis

Spring Wheat Jul 2014 651.75 -5.5 -0.84%

Spring Wheat Sep 2014 665 -5.25 -0.78%

Spring Wheat Dec 2014 675.75 -4.5 -0.66%

Spring Wheat Mar 2015 687.5 -5.25 -0.76%

Spring Wheat May 2015 693 -7.25 -1.04%

Kansas City

KC HRW Wheat Jul 2014 683 -17 -2.43%

KC HRW Wheat Sep 2014 681.75 -7 -1.02%

KC HRW Wheat Dec 2014 690.25 -5.75 -0.83%

KC HRW Wheat Mar 2015 696 -6.25 -0.89%

KC HRW Wheat May 2015 698 -3.5 -0.50%

Light crude oil nearby futures in New York dropped 86 cents at $104.48 US per barrel.

The Canadian dollar at noon was 93.75 cents US, up from 93.67 cents the previous trading day. The U.S. dollar at noon was $1.0667 Cdn.

Reuters reported that payrolls processor ADP showed U.S. companies hired more workers in June than they did in any month since November 2012. The data beat market expectations. Gains were limited though as the market awaits the more influential government report on employment on Thursday.

Reuters also reported a measure of the Canadian manufacturing sector picked up in June to its highest level of the year so far.

The TSX composite posted a new record high and is up about 11.5 so far this year. The Dow and S&P 500 also closed at record highs.

In early unofficial tallies —

The TSX composite closed up 63.78 points or 0.42 percent at 15,209.79.

The Dow Jones industrial average rose 20.17 points or 0.12 percent, to 16,976.24.

The S&P 500 gained 1.29 points or 0.07 percent, to 1,974.61.

The Nasdaq Composite dropped 0.92 points or 0.02 percent, to 4,457.73.