The Good: U.S. wheat exports during the week ending on October 16 were solid at 480,614 tonnes. This pushed total exports to date to 11.92 million tonnes that have been shipped since June 1. This is the strongest export performance for U.S. wheat since the 2013-14 marketing year. The challenge for U.S. wheat exports during the coming months will not be due to export demand, but limited export capacity. The drop in U.S. wheat export capacity is good news for Canada as that will reduce competition for Western Canadian wheat in the coming weeks and months. This should result in even stronger demand for Canadian wheat.
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The Good, Bad & Ugly
The Good: Wheat markets were strong today with nearby futures moving up by 10 cents per bushel to close the day…
The Bad: The wheat market had a positive day with nearby spring wheat contract closing up three cents per bushel to settle at US$5.48 per bushel. Despite the move today, spring wheat continues to trade 11 cents per bushel below the 20 day moving average for the contract. That is bad news from a technical standpoint. Chicago and Kansas City futures were also up three cents per bushel. Despite the rally in spring wheat, the nearby futures contract is still just trading above contract lows.
The Ugly: The canola market closed the day down by C$2.50 to settle at C$613.10 per tonne. The drop in canola came despite a rally in nearby soybean futures of four cents per bushel. Soybean oil futures were down by 1.15 per cent during the day which pressured canola futures. European rapeseed futures were up by 1.6 per cent which limited the losses in ICE canola. The ugly news is that the losses in canola pushed the contract below the 20 day moving average of C$613.94 per tonne. The leaves the canola contract vulnerable to a further sell-off in the coming days and weeks. The other piece of ugly news is that canola has posted five consecutive sessions of losses.
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