North American Grain and Oilseed Review: Another day of gains for canola

By Glen Hallick, MarketsFarm

WINNIPEG, Sept. 15 (MarketsFarm) – Intercontinental Exchange (ICE) canola futures were up on Wednesday, with spillover support from Chicago soybeans and soyoil, as well as other edible oils. However, canola prices backed away from earlier highs due to farmer hedging.

A trader said the updated canola forecast put forth by Statistics Canada on Monday should have been one million tonnes less than the 12.8 million the federal agency reported. He pointed to the lower canola yields reported by the Prairie Provinces compared to those used by Statistics Canada.

At mid-afternoon the Canadian dollar was higher, which tempered gains made in canola. The loonie was at 79.13 U.S. cents, compared to Tuesday’s close of 78.98.

There were 35,548 contracts traded on Wednesday, which compares with Tuesday when 39,618 contracts changed hands. Spreading accounted for 23,236 contracts traded.

Settlement prices are in Canadian dollars per metric tonne.

Price Change
Canola Nov 879.80 up 7.50
Jan 871.80 up 8.80
Mar 858.60 up 8.70
May 841.60 up 7.80

SOYBEAN futures at the Chicago Board of Trade (CBOT) were higher on Wednesday following the monthly report from National Oilseeds Processors Association (NOPA).

NOPA said 158.8 million bushels of U.S. soybeans were crushed in August, which was 2.4 more than in July, but 3.8 per cent than the August 2020 crush.

The United States Department of Agriculture (USDA) reported the cancellation of two private sales of soybeans. One was for 132,000 tonnes to China and the other for 196,000 tonnes to unknown destinations.

The Buenos Aires Grain Exchange (BAGE) raised its projection of 2021/22 soybean production in Argentina by 2.1 per cent at 44 million tonnes. That’s a sharp contrast with the USDA’s estimate of 52 million tonnes.

CORN futures were stronger on Wednesday, on indications from the very early stages of the U.S. corn harvest that yields have been lower than anticipated.

The U.S. Energy Information Administration (EIA) reported ethanol production for the week ended Sept. 10 increased 14,000 barrels per day (BPD) at 937,000 BPD. That consumed 92.8 million bushels of corn, up 1.5 per cent from a week ago. Ethanol stocks were 20 million barrels for a 15-week low.

Cargill announced that it resumed operations at its Westwego terminal, following damage caused by Hurricane Ida, however damage to The Reserve, Louisiana facility was still being determined.

The BAGE pegged 2021/22 corn production in Argentina at a record 55 million tonnes, due to an increase in planted acres. The USDA estimated the Argentina corn crop at 53 million tonnes.

Brazil reported that the harvest of its safrinha corn crop for 2020/21 was almost complete and that the planting of the first corn crop for 2021/22 was at 16 per cent finished.

Corn exports out of the European Union as of Sept. 12 were 3.03 million tonnes, which is 16.1 per cent behind those from a year ago.

WHEAT futures were stronger as well on Wednesday, still reacting to the sharp decline in Canadian wheat production projected by Statistics Canada.

The BAGE forecast the 2021/22 wheat harvest in Argentina to be 19.2 million tonnes, for an increase of a little more than one per cent from its previous estimate.

The EU reported its wheat exports as of Sept. 12 were 5.79 million tonnes, which was 44.8 per cent above those this time last year.

France said its wheat exports outside of the EU should be around 9.6 million tonnes, a drop of 900,000 tonnes from the previous estimate.

Futures Prices as of September 15, 2021

Canola
Price Change
Milling Wheat
1970-01-01 00:00
Price Change
Durum
1970-01-01 00:00
Price Change
New Barley
1970-01-01 00:00
Price Change

Prices are in Canadian dollars per metric ton

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