Wheat futures were hit the hardest by a U.S. Department of Agriculture report on Wednesday that generally increased the estimated size of world grain supplies.
The USDA’s assessment of oilseed crops was less bearish and canola futures dipped only slightly. Soybeans gained a little ground.
It forecast a small U.S. oats crop and that helped lift Chicago oats futures.
November canola closed at $529.50 per tonne, down $5.70 or 1.07 percent, due mainly to a strong gain in the loonie, but also on profit taking after the strong rally on Tuesday.
USDA trimmed its estimate of the U.S. soybean crop and year end stocks.
The corn numbers in the USDA report were more bearish. It trimmed its U.S. production number slightly, but revised up its estimate of carry in stocks, resulting in an increase in total supply. It also trimmed U.S. corn exports.
The result is a forecast for 2011-12 year end stocks of 866 million bushels, up from 672 million in the September report.
However, that is still down from last year’s 1.13 billion bu.
Globally, USDA raised its forecast for Chinese corn production by four million tonnes to a record 182 million tonnes. It also raised its production estimates for corn production in the former Soviet Union.
The negative impact on corn prices of the USDA report was partly offset by news that China booked purchases for state reserves of about 1.5 million tonnes of corn on Tuesday, with the supplies coming from either the United States or Argentina.
In wheat, USDA lowered U.S. production but that was more than offset by increased estimates of European, Australian and Kazakhstan production. It also lowered its forecast for world wheat consumption.
Global ending stocks of wheat for 2011-12 were increased to 202.37 million tonnes from 194.59 million in the September report. Last year’s global ending stocks were 195.6 million tonnes.
USDA put the domestic hard red spring wheat crop at 405 million bu., down from the September estimate of 475 million and 570 million last year.
USDA pegged domestic durum production at 52 million bu., down from the September estimate of 57 million and 106 million last year.
It put oats production at 54 million bu., down from 57 million in September and 81 million last year.
U.S. canola production was also hammered lower due to weather challenges in North Dakota. USDA pegged production at 694,980 tonnes, down from 1.11 million tonnes last year.
Winnipeg (per tonne)
Canola Nov 11 $529.50, down $5.70 (-1.07%)
Canola Jan 12 $539.10, down $5.20 (-0.96%)
Canola Mar 12 $548.20, down $5.10 (-0.92%)
Canola May 12 $555.80, down $3.90 (-0.70%)
The previous day’s best basis was $22.25 under the November contract according to ICE Futures Canada in Winnipeg.
The November contract’s 14-day Relative Strength Index was 44. The rule of thumb is an RSI of 30 indicates an over sold and 70 is over bought.
Western Barley Oct 11 $210, unchanged
Chicago (per bushel)
Soybeans Nov 11 $12.395, up 4.0 cents (+0.32%)
Soybeans Jan 12 $12.495, up 3.25 (+0.26%)
Soybeans Mar 12 $12.57, up 2.0 (+0.16%)
Corn Dec 11 $6.4075, down 4.25 (-0.66%)
Corn Mar 12 $6.5275, down 4.75 (-0.72%)
Oats Dec 11 $3.45, up 6.0 (+1.77%)
Oats Mar 12 $3.54, up 5.0 (+1.43%)
Minneapolis (per bushel)
Spring Wheat Dec 11 $9.0375, down 32.75 cents (-3.50%)
Spring Wheat Mar 12 $8.4625, down 20.0 (-2.31%)
Spring Wheat May 12 $8.2675, down 19.5 (-2.30%)
Light crude oil nearby futures in New York fell 24 cents to $85.57 US per barrel.
The Canadian dollar at noon was 98.39 cents US, up from 97.21 cents the previous trading day. The U.S. dollar at noon was $1.0164 Cdn.
The Toronto Stock Exchange composite index unofficially ended up 154.41 points, or 1.30 percent, at 12,029.96. (There was an error in Tuesday’s report. The TSX composite closed yesterday at 11,875.55.)
The Standard & Poor’s 500 Index rose 11.56 points, or 0.97 percent, to close at 1,207.10 today.
