Wheat contracts posted their third straight day of gains on Wednesday, riding on concerns about the political situation in Ukraine and crop health in the U.S. winter wheat region.
Canola futures varied little during the day and closed slightly higher despite lower soybean and soy oil futures.
A weaker loonie helped support canola. Support also came from thoughts that canola is undervalued compared to soy. There is also technical strength.
The soy complex was weighed down by worries that China’s economy might be slowing. A few economic measures, including monthly exports, recently have shown China’s economy appears to be struggling. Also, slowing growth of its livestock sectors could lead to reduced growth demand for feeds, including soy meal.
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U.S. grains: Soybean futures jump on hopes for US export demand
Chicago Board of Trade soybean futures jumped on hopes for U.S. export demand on Wednesday, while corn futures rose for a third day to extend a recovery from contract lows, analysts said.
Rumours of China cancelling soy orders not only from the U.S. but also Brazil, also hang over the market.
The latest crop forecast from Brazil’s crop supply agency Conab limited declines in soy. It cut its outlook for the soybean crop by five percent to 85.44 million tonnes. That is well below USDA’s forecast of 88.5 million tonnes.
The lightly traded Chicago oats contact hit record highs as traders exited their short positions ahead of the March contract’s expiration on Friday.
Only 59 contracts in the March futures were open when trading began on Wednesday, making the market more vulnerable to wild price swings, traders told Reuters.
March oats, which are trading without daily limits, soared 85 ¼ cents to a record $5.63 ¼ per bushel on Wednesday, surpassing the previous high of $5.50 ½ set a week ago.
Prairie cash prices for oats are dismal because of the inability to get the product to the U.S.
Corn futures followed wheat higher. There is talk that excess rain in Brazil’s Mato Grosso state could trim corn production.
Although the political turmoil in Ukraine has not yet had a significant impact on the country’s exports or production, the threat of increased violence and economic-financial disruption continues to lift wheat and corn.
Traders are also concerned about the state of the U.S. hard red winter wheat crop. It is in better shape than last year but it is still not clear how much damage the severe winter caused.
Also, parts of western Kansas and Oklahoma, both major winter wheat producers, are very dry.
Winnipeg ICE Futures Canada dollars per tonne
Canola Mar 2014 443.40 +2.30 +0.52%
Canola May 2014 454.10 +2.10 +0.46%
Canola Jul 2014 462.80 +1.60 +0.35%
Canola Nov 2014 479.70 +1.70 +0.36%
Canola Jan 2015 486.90 +1.50 +0.31%
Milling Wheat Mar 2014 214.00 +8.00 +3.88%
Milling Wheat May 2014 220.00 +8.00 +3.77%
Milling Wheat Jul 2014 219.00 +8.00 +3.79%
Durum Wheat Mar 2014 245.00 unch 0.00%
Durum Wheat May 2014 249.00 unch 0.00%
Durum Wheat Jul 2014 250.00 unch 0.00%
Barley Mar 2014 126.50 unch 0.00%
Barley May 2014 128.50 unch 0.00%
Barley Jul 2014 128.50 unch 0.00%
American crop prices in cents US/bushel, soybean meal in $US/short ton, soy oil in cents US/pound
Chicago
Soybeans Mar 2014 1381.75 -29.75 -2.11%
Soybeans May 2014 1387 -26 -1.84%
Soybeans Jul 2014 1368.5 -22.75 -1.64%
Soybeans Aug 2014 1329.25 -21.5 -1.59%
Soybeans Sep 2014 1234.25 -13.5 -1.08%
Soybeans Nov 2014 1176.25 -13.25 -1.11%
Soybean Meal Mar 2014 448.3 -4 -0.88%
Soybean Meal May 2014 436.5 -7.7 -1.73%
Soybean Meal Jul 2014 426 -7 -1.62%
Soybean Oil Mar 2014 43.2 -0.31 -0.71%
Soybean Oil May 2014 43.42 -0.33 -0.75%
Soybean Oil Jul 2014 43.5 -0.37 -0.84%
Corn Mar 2014 484.25 +6.25 +1.31%
Corn May 2014 488.5 +5.25 +1.09%
Corn Jul 2014 492 +5 +1.03%
Corn Sep 2014 488.5 +5.25 +1.09%
Corn Dec 2014 486.25 +5 +1.04%
Oats Mar 2014 557.75 +79.75 +16.68%
Oats May 2014 444.5 +20 +4.71%
Oats Jul 2014 393.5 +20 +5.35%
Oats Sep 2014 339.25 +6.75 +2.03%
Oats Dec 2014 329 +12.5 +3.95%
Wheat Mar 2014 688 +24.75 +3.73%
Wheat May 2014 683.75 +24.75 +3.76%
Wheat Jul 2014 688.25 +24 +3.61%
Wheat Sep 2014 696.75 +24 +3.57%
Wheat Dec 2014 707 +23 +3.36%
Minneapolis
Spring Wheat Mar 2014 751 unch 0.00%
Spring Wheat May 2014 730.75 +23.75 +3.36%
Spring Wheat Jul 2014 726.5 +22 +3.12%
Spring Wheat Sep 2014 727 +17.5 +2.47%
Spring Wheat Dec 2014 737 +17.25 +2.40%
Kansas City
KCBT Red Wheat Mar 2014 741.25 +19.25 +2.67%
KCBT Red Wheat May 2014 747.75 +19.25 +2.64%
KCBT Red Wheat Jul 2014 742 +17 +2.34%
KCBT Red Wheat Sep 2014 748.5 +17.25 +2.36%
KCBT Red Wheat Dec 2014 758.75 +17.5 +2.36%
Light crude oil nearby futures in New York dropped $2.04 at $97.99 US per barrel.
The Canadian dollar at noon was 89.83 cents US, down from 90.21 cents the previous trading day. The U.S. dollar at noon was $1.1132 Cdn.
The Toronto Stock Exchange and American indexes were lower early as worries about slowing growth in China weighed on crude oil and metal markets. Later, markets turned up as concerns about the Ukraine situation eased a little.
