Oilseeds rose Wednesday as crude oil rose and the U.S. dollar fell.
Delayed seeding in Canada and dry weather that is hurting Europe’s canola crop also supported canola.
An organization of German farm co-operatives reduced its forecast of canola production to 5.19 million tonnes from 5.73 million produced last year.
Some canola was damaged by a harsh winter and the weather has now turned dry. It is also dry in France. There is still time for the crop to recover if rain improves.
Oilseeds were supported by rising crude oil, which topped $110 per barrel again in New York.
Crude rose on the weak U.S. dollar and a surprise drop in U.S. oil supplies for last week. The U.S. Energy Information Administration also said gasoline supplies fell more than expected. Economists are divided on whether high oil prices will cause people to cut their use, what economists call demand destruction.
Corn fell on a forecast for drier weather in May in the Midwest, which would allow better seeding progress after a string of wet days in April.
Wheat futures saw a wide trading range, rising in the morning on dry weather in the U.S. southern plains, but Kansas City and Minneapolis closed at a slightly loss when traders sold and took profits after a key technical measure, the 100-day moving average, was crossed.
The International Grains Council released a report today forecasting that world wheat stocks will not increase in the coming crop year despite rising production.
IGC estimated production at 672 million tonnes, up from 650 million in the current crop year.
It said consumption would be 672 million, up from 662 million.
That leaves ending stocks steady at 186 million tonnes for a stocks-to-use ratio of 27.7 percent.
In corn, IGC forecasts that world consumption at 854 million tonnes will surpass production at 847 million, resulting in a further drawdown in global stocks to 111 million tonnes. That gives a stocks-to-use ratio of 12.9 percent.
Australia is expected to increase wheat area this year and eastern growing areas have good soil moisture, but Western Australia is still struggling with below normal precipitation.
Winnipeg (per tonne)
Canola May 11$574.00, up $3.60
Canola Jul 11 $583.80, up $4.50
Canola Nov 11 $582.80, up $4.50
Canola Jan 12 $589.20, up $3.90
The previous day’s best basis was $6.10 under the May contract according to ICE Futures Canada in Winnipeg.
The May contract’s Relative Strength Index was 44. The rule of thumb is an RSI of 30 indicates an over sold market and 70 indicates an over bought market.
Western Barley May 11 $200.00, unchanged
Chicago (per bushel)
Soybeans May 11 $13.575 up 15.75 cents
Soybeans Jul 11 $13.6925, up 15.25
Soybeans Nov 11 $13.66, up 12.0
Corn May 11 $7.3275, down 16.25
Corn Dec 11 $6.555, down 20.5
Oats May 11 $3.875, down 6.5
Oats Dec 11 $4.07, down 6.5
Minneapolis (per bushel)
Spring Wheat May 11 $9.3875, down 4.5 cents
Spring Wheat Jul 11 $9.485, down 3.0
Spring Wheat Dec 11 $9.645, down 3.2
Light crude oil nearby futures in New York jumped $3.17 to $111.45 US per barrel.
The Canadian dollar at noon was $1.0500 US, up from $1.0448 the previous trading day. The U.S. dollar at noon was 95.24 cents Cdn.
The Toronto Stock Exchange composite index rose 160.65 points, or 1.17 percent, to 13,897.48, with energy companies leading the way up.
The Standard and Poor’s 500 index rose 17.74 points, or 1.35 percent, to 1330.36. Strong quarterly earnings at Intel, Yahoo and IBM helped lift stock prices.
