North American Grain and Oilseed Review: Next week’s rain undercuts today’s canola
CBOT soy takes a hit, wheat turns around
By Glen Hallick, MarketsFarm
Glacier Farm Media MarketsFarm – Intercontinental Exchange canola futures fell back on Wednesday due to rain in next week’s Prairie weather forecast. The much-needed moisture is to help alleviate dry conditions throughout most of the region.
Today’s losses wiped out all of Tuesday’s increases and a little bit more.
Additional pressure on canola came from declines in the Chicago soy complex and European rapeseed. Malaysian palm oil and crude were higher, providing some support.
Tight old crop supplies and bullish chart signals also underpinned the market.
The Canadian dollar retreated on Wednesday afternoon with the loonie dropping to 72.30 U.S. cents compared to Tuesday’s close of 72.60.
There were 45,096 contracts traded on Wednesday, compared to 42,707 on Tuesday. Spreading accounted for 19,412 contracts traded.
Prices are in Canadian dollars per metric tonne:
Price Change Canola Jul 715.90 dn 16.30 Nov 686.30 dn 8.00 Jan 692.30 dn 7.70 Mar 697.50 dn 7.50
SOYBEAN futures at the Chicago Board of Trade were weaker on Wednesday, due to ongoing uncertainty over the United States 45Z biofuel tax credit.
There has been chatter in the market this week that the U.S. Environmental Protection Agency will make an announcement about 45Z, but it’s unclear whether the Trump administration wants to keep or cut the tax credit.
The U.S. Department of Agriculture issued its crop progress report and as of May 25 soybean planted were at 76 per cent complete. That’s a gain of 10 points on the week and eight ahead of the five-year average. Soybeans emerged reached the halfway point, up 16 points and 10 ahead of pace.
The U.S. weather outlook has called for scattered rains next week, with the Eastern Corn Belt and the Plains to get the most precipitation.
CORN futures were lower on Wednesday, getting pressure from a weaker soy complex.
Corn planting in the U.S. hit 87 per cent done, up nine points during the week and two above the average pace. The USDA rated the crop at 68 per cent good to excellent, seven points below trade expectations.
Rain in Argentina continued to slow its corn harvest.
WHEAT futures were higher on Wednesday, due to a lower than expected crop rating for U.S. spring wheat.
Spring wheat planting bumped up five points at 87 per cent finished, with progress seven points above the average pace. With 60 per cent of the crop emerged, it rated 45 per cent good to excellent. That fell short of the market prediction of 71 per cent.
At 50 per cent good to excellent, U.S. winter wheat dipped one point from last week. Three-quarters of the crop has headed, up 11 points and five up on the average.
Ongoing dryness in France will reduce its wheat yields.
