By D’Arce McMillan
Saskatoon newsroom
Crop futures including canola rallied strongly on Friday on worries about the declining size of the U.S. corn crop.
November canola closed at $567.50 per tonne, up $5.60.
On the week it rose $13.10 or 2.4 percent.
The upside was limited by strong harvest progress in Western Canada.
A crop tour of the Midwest sponsored by Pro Farmer magazine wrapped up today and forecast corn yield at 147.9 bu. per acres and production at 12.484 billion bushels. That is well down from the U.S. Department of Agriculture’s most recent forecast of 153.0 bu. per acre and a crop of 12.914 billion bu.
The tour put the soybean yield at 41.8 bu. per acre, up from USDA’s 41.4 bu. and production at 3.083 billion bu., up from USDA’s 3.056 billion.
Commodity markets reacted favourably to Federal Reserve chairman Ben Bernanke speech Friday.
He stopped short of signaling further action to boost the U.S. recovery, but said it was critical for the economy’s health to reduce unemployment. He said the bank’s policy panel would meet for two days in September instead of one to discuss additional monetary stimulus, offering some hope to investors for more simulative action in the future.
U.S. equity markets also rose and the U.S. dollar fell.
Corn and soybeans jumped higher. Corn was supported by a large export sale to an unnamed destination.
The Canadian Wheat Board released its estimate of Western Canadian grain crops. It pegged the all wheat crop at 21.3, down 300,000 tonnes from Statistics Canada’s forecast released earlier this week.
It forecast the durum crop at 3.9 million tonnes compared to StatsCan’s 3.7 million and barley at eight million, compared to StatsCan’s 7.8 million.
The CWB did not release a canola production forecast.
Although Canada’s wheat crop is better than expected earlier this year, Minneapolis spring wheat prices rallied Friday on worries about poor yield in North Dakota and on the extreme drought in the winter wheat growing region of the southern plains.
The CWB also said it expected the quality of this years crop to be superior to last year, however, much still depends on the weather.
The Canadian Oilseed Processors Association said members crushed 86,039 tonnes of canola in the week ending Aug. 24 for crush capacity use of only 59 percent.
That was down 22 percent from the week before.
Winnipeg per tonne)
Canola Nov 11 $567.50, up $5.60
Canola Jan 12 $576.00, up $5.50
Canola Mar 12 $584.20, up $5.50
Canola May 12 $590.70, up $5.60
The previous day’s best basis was $10.00 under the November contract according to ICE Futures Canada in Winnipeg.
The November contract’s 14-day Relative Strength Index was 59. The rule of thumb is an RSI of 30 indicates an over sold market and 70 indicates an over bought market.
Western Barley Oct 11 205.00, up 4
Chicago (per bushel)
Soybeans Sep 11 $14.1475, up 28.75 cents
Soybeans Nov 11 $14.235, up 30.75
Soybeans Jan 12 $14.3275, up 29.5
Corn Sep 11 $7.524, up 20.25
Corn Dec 11 $7.67, up 23.5
Oats Sep 11 $3.79, up 11.0
Oats Dec 11 $3.88, up 10.0
Minneapolis (per bushel)
Spring Wheat Sep 11 $9.5625, up 21.5 cents
Spring Wheat Dec 11 $9.3675, up 16.75
Spring Wheat Mar 12 $9.3975, up 17.5
Light crude oil nearby futures in New York rose seven cents at $85.37 US per barrel.
The Canadian dollar at noon was $1.0149 US, down from $1.0160 the previous trading day. The U.S. dollar at noon was 98.53 cents Cdn.
The Toronto Stock Exchange composite index in a preliminary tally closed up 43.20 points or 0.35 percent, at 12,327.51.
The Standard & Poor’s 500 Index unofficially closed up 17.30 points, or 1.49 percent, as 1,176.57.
For the week the TSX closed up 2.7 percent and the S&P rose 4.7 percent.
