The Good: The good news today was that spring wheat futures closed the day unchanged. This is the third consecutive day where spring wheat closed the trading session. The good news is that spring wheat appears to be finally forming a bottom. The U.S. spring wheat harvest is 94 per cent complete which is slightly ahead of last year (91 per cent) and the 5-year average (92 per cent). With the Canadian harvest just over one-third done, spring wheat harvest pressure looks to fade away in the coming weeks. That is good news as spring wheat and wheat in general will finally be able to move off of contract lows and stage a proper rally.
The Bad: Soybean harvest is just beginning in the Corn Belt with a total of five per cent in the bin as of September 14. The bad news is that this progress rate is slightly ahead of average (three per cent) and close to last year (six per cent). Harvest is most advanced in the delta states with Illinois and Iowa at three per cent and one per cent respectively. The bad news for the oilseed markets is that the forecast in the Corn Belt is calling for hot and mostly dry conditions over the next week. Expect substantial harvest pressure in the coming weeks in the oilseed markets.
The Ugly: The ugly news today is that canola futures closed the session down by C$7.40 per tonne to settle at C$632.30 per tonne. The loss today pushed the contract back below the 20 day moving average and broke a three day winning streak and halted the small rally off of the recent lows. The main concern continues to be Chinese tariffs and slow export business so far this crop year. Exports to the end of September 7th totaled 529,500 tonnes which is down by more than half from last year’s pace. Export demand will be the key to the canola market in the next two months and so far it has been very ugly.
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