A sharp drop in the weekly conditions rating of the U.S. spring wheat crop prompted nearby Minneapolis spring wheat futures to rally more than 4.5 percent on Tuesday.
The wheat rally helped to lift corn and soybeans but canola futures fell on expectations for rain over much of the Prairies today and Wednesday as well as a stronger loonie, which was up about a half cent today to about US75.5 cents.
Gross Domestic Product is rising, as is the number of people working, leading analysts to speculate that the Bank of Canada will raise interest rates, perhaps in the first half of 2018.
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WHEAT RALLIES
Spring wheat hit the highest level since June 29, 2015. New crop December closed at US$6.28 3/4. This marks an opportunity to consider pricing some new crop.
The U.S. Department of Agriculture on Monday said that the spring wheat crop was only at 45 percent good-to-excellent as of June 4, down 10 percentage points from a week earlier. Analysts had expected a good-to-excellent rating of 53 percent.
Last year at the same time the condition was 79 percent good to excellent.
Analysts at Farm Futures have yield projection models based on the weekly conditions ratings.
“USDA cut its assessment of the spring wheat crop sharply for the second straight week, knocking more than three bushels per acre off yield potential according to our models,” Farm Futures senior analyst Bryce Knorr said in a note to clients. “That could trim 30 million bushels off the total wheat crop.”
However, competition in the wheat market should remain strong in 2017-18 because the Black Sea region expects a strong crop with the exception of central Ukraine where dry weather is causing problems.
Australia expects about an average crop based on early forecast from its national forecaster.
WEATHER
Southern Alberta was getting rain on Tuesday. There were local showers in Saskatchewan.
The rain is expected to become more general in Saskatchewan as the day progresses and continue into Wednesday.
The heaviest accumulations are now expected in northeastern Saskatchewan, an area where soil moisture is already excessive in many places. However the rain in more southern and central areas will be welcome.
Manitoba should also get widespread coverage from this rain system.
AUSTRALIA
THE Australian Bureau of Agricultural and Resource Economics and Sciences crop report released today indicated a return to more normal production after last year’s record smashing crop.
It forecasts wheat production at 24.19 million tonnes, up a little from it pre seeding March estimate of 23.98 million tonnes.
Ideal weather last year led to a record 35.109 million tonne wheat crop.
It sees canola production at 3.317 million down from its pre-seeding estimate of 3.69 million tonnes. Dry weather discouraged seeding.
Last year’s canola crop was 4.14 million tonnes.
OUTSIDE MARKETS
Light crude oil nearby futures in New York rose 38 cents to US$46.46 per barrel.
The Canadian dollar in the afternoon was trading at US75.55 cents, up from 75.03 cents the previous trading day. The U.S. dollar was C$1.324.
The Toronto Stock Exchange’s S&P/TSX composite index closed down 4.25 points, or 0.03 percent, at 15,379.75.
The Dow Jones Industrial Average rose 92.8 points, or 0.44 percent, to 21,328.47, the S&P 500 gained 10.96 points, or 0.45 percent, to 2,440.35, a record high, and the Nasdaq Composite added 44.90 points, or 0.73 percent, to 6,220.37.
Winnipeg ICE Futures Canada dollars per tonne
Canola Jul 2017 511.20 -3.60 -0.70%
Canola Nov 2017 484.50 -7.70 -1.56%
Canola Jan 2018 490.20 -7.80 -1.57%
Canola Mar 2018 495.70 -7.60 -1.51%
Canola May 2018 497.90 -7.60 -1.50%
Milling Wheat Jul 2017 269.00 +9.00 +3.46%
Milling Wheat Oct 2017 263.00 +7.00 +2.73%
Milling Wheat Dec 2017 266.00 +7.00 +2.70%
Durum Wheat Jul 2017 279.00 unch 0.00%
Durum Wheat Oct 2017 269.00 unch 0.00%
Durum Wheat Dec 2017 269.00 unch 0.00%
Barley Jul 2017 138.00 unch 0.00%
Barley Oct 2017 140.00 unch 0.00%
Barley Dec 2017 140.00 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 2017 932.50 +1.25 +0.13%
Soybeans Aug 2017 936.25 +1.25 +0.13%
Soybeans Sep 2017 936.75 +1.25 +0.13%
Soybeans Nov 2017 939.00 +0.75 +0.08%
Soybeans Jan 2018 946.25 +0.50 +0.05%
Soybeans Mar 2018 951.00 +0.50 +0.05%
Soybean Meal Jul 2017 301.50 -0.30 -0.10%
Soybean Meal Aug 2017 303.40 -0.20 -0.07%
Soybean Meal Sep 2017 305.00 unch 0.00%
Soybean Oil Jul 2017 32.09 +0.15 +0.47%
Soybean Oil Aug 2017 32.21 +0.14 +0.44%
Soybean Oil Sep 2017 32.33 +0.15 +0.47%
Corn Jul 2017 381.00 +3.75 +0.99%
Corn Sep 2017 388.50 +3.50 +0.91%
Corn Dec 2017 399.00 +3.50 +0.88%
Corn Mar 2018 408.25 +3.50 +0.86%
Corn May 2018 414.00 +3.75 +0.91%
Oats Jul 2017 253.25 +3.50 +1.40%
Oats Sep 2017 244.50 +3.25 +1.35%
Oats Dec 2017 240.75 +3.50 +1.48%
Oats Mar 2018 237.75 +5.00 +2.15%
Oats May 2018 238.25 +5.00 +2.14%
Wheat Jul 2017 445.00 +11.00 +2.53%
Wheat Sep 2017 459.25 +10.75 +2.40%
Wheat Dec 2017 480.75 +10.00 +2.12%
Wheat Mar 2018 498.25 +10.00 +2.05%
Wheat May 2018 510.75 +10.00 +2.00%
Minneapolis
Spring Wheat Jul 2017 628.00 +27.50 +4.58%
Spring Wheat Sep 2017 634.50 +28.25 +4.66%
Spring Wheat Dec 2017 628.75 +23.50 +3.88%
Spring Wheat Mar 2018 625.25 +18.25 +3.01%
Spring Wheat May 2018 619.25 +12.50 +2.06%
Kansas
Hard Red Wheat Jul 2017 457.00 +14.25 +3.22%
Hard Red Wheat Sep 2017 474.25 +13.75 +2.99%
Hard Red Wheat Dec 2017 498.25 +12.25 +2.52%
Hard Red Wheat Mar 2018 511.00 +11.25 +2.25%
Hard Red Wheat May 2018 521.75 +10.50 +2.05%
Chicago livestock futures in US¢/pound (rounded to two decimal places)
Live Cattle (P) Jun 2017 127.50 -0.85 -0.66%
Live Cattle (P) Aug 2017 120.88 -0.67 -0.55%
Live Cattle (P) Oct 2017 117.38 -0.82 -0.69%
Feeder Cattle (P) Aug 2017 149.95 -1.60 -1.06%
Feeder Cattle (P) Sep 2017 149.70 -1.53 -1.01%
Feeder Cattle (P) Oct 2017 148.32 -1.48 -0.99%
Lean Hogs (P) Jun 2017 82.78 +0.81 +0.99%
Lean Hogs (P) Jul 2017 82.28 +1.58 +1.96%
Lean Hogs (P) Aug 2017 80.22 +0.22 +0.27%
