By Glen Hallick, MarketsFarm
WINNIPEG, June 13 (MarketsFarm) – Intercontinental Exchange (ICE) canola futures closed higher on Tuesday, largely due to strong gains in the Chicago soy complex.
The United States Environmental Protection Agency is set to announce new biodiesel blending requirements on Wednesday. In turn, that has generated a great deal of short covering in soyoil.
Additional support for canola came from increases in European rapeseed and Malaysian palm oil. Significant upticks in global crude oil prices were lending support to the vegetable oils.
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Canola and other crops in Alberta and western Saskatchewan are in need of rain. Such is in the forecast over the coming days, but should it fail to materialize, those dry conditions will push canola prices upward.
The boards for Bunge and Glencore approved a deal for the former to acquire Viterra in a multi-billion-dollar deal. However, it’s likely to face regulatory scrutiny in a number of countries, including Canada.
Port workers in Vancouver and Prince Rupert voted overwhelmingly in favour of strike action should talks for a new contract fail. The earliest picket lines could be set up is June 24.
The Canadian dollar was higher at mid-afternoon Tuesday, with the loonie at 75.11 U.S. cents, compared to Monday’s close of 74.82.
There were 34,495 contracts traded on Tuesday, which compares with Monday when 40,405 contracts changed hands. Spreading accounted for 19,624 contracts traded.
Prices are in Canadian dollars per metric tonne:
Price Change Canola Jul 699.30 up 10.30 Nov 676.50 up 10.80 Jan 682.20 up 10.20 Mar 688.00 up 10.20
SOYBEAN futures at the Chicago Board of Trade (CBOT) were stronger on Tuesday, ahead of the new biodiesel blending requirements set by the United States Environmental Protection Agency.
In the crop progress report from the U.S. Department of Agriculture, soybean planting was at 96 per cent complete across the country as of June 11, progressing five points over the week and 10 ahead of the five-year average. Emergence reached 86 per cent, rising 12 points and 16 ahead of the average. The national crop rated 59 per cent good to excellent, down three points from the previous week.
Dr. Michael Cordonnier of Soybean and Corn Advisor projected U.S. soybean yields for 2023/24 at 51.5 bushels per acre, down a half point from his previous forecast. His projection would result in a harvest of 4.48 billion bushels.
Bunge and Glencore struck a deal for the former to acquire the latter’s 49.99 per cent share in Viterra, that will create a conglomerate worth about US$34 billion. Bunge was already the world’s largest oilseed crusher.
With the Brazil soybean harvest wrapping up, CONAB estimated the crop will hit a record 155.74 million tonnes. That’s slightly higher than CONAB’s May forecast and 24 per cent larger than last year’s crop.
France estimated its winter rapeseed harvest is to bring in 4.63 million tonnes, up 2.6 per cent from last year and the largest since 2018.
CORN futures saw gains in the new crop contracts on Tuesday as dry conditions remains an issue in the U.S., especially in the Eastern Corn Belt.
The USDA said corn emerged rose eight points on the week to 93 per cent, six ahead of the average. The crop rated 61 per cent good to excellent, down three from a week ago.
Cordonnier estimated U.S. corn yields for 2023/24 at 178.0 bu./ac. and that would lead to production of 14.86 billion bushels.
As Brazil’s second corn harvest continued to get underway, CONAB projected the country’s total corn production for 2022/23 to be 125.72 million tonnes – new record. The safrinha harvest is to account for 96.31 million tonnes. However, there is a possibility of overnight frost in the coming days.
WHEAT futures closed mixed on Tuesday, with a gain in Chicago and losses in Kansas City and Minneapolis.
The USDA reported winter wheat headed at 89 per cent, advancing seven points during the week and virtually on par with the five-year average. The harvest doubled to eight per cent complete, also near the average. The crop rated 38 per cent good to excellent, up two from last week. Kansas was the worst state at 14 per cent good to excellent.
U.S. spring wheat planted hit 97 per cent complete, up four points and on par with the average. Emergence increased 14 points at 90 per cent, three up on the average. The crop rated 60 per cent good to excellent, down four on the week.
France said its winter barley harvest is to reap 9.07 million tonnes, rising 7.3 per cent from last year, and the largest in four years.
