North American Grain and Oilseed Review: Oilseed sell-off drags down canola
Another round of steep losses for CBOT soybeans, soyoil
By Glen Hallick, MarketsFarm
Glacier Farm Media MarketsFarm – Intercontinental Exchange canola futures dropped hard on Tuesday, forced to follow another day of sharp declines in the Chicago soy complex.
Canola also felt the pressure from sizeable pullbacks in European rapeseed and Malaysian palm oil. Losses in crude oil added to the slide in oilseeds.
A trader commented that canola had been holding its own against the drop in Chicago soyoil, but the latter fell so much and so quickly that the Canadian oilseed had no choice but to fall back.
Added to the declines was the improving weather across the Prairies. While temperatures move above normal, the ample amounts of soil moisture combined with rising humidity will allow the region’s crop to withstand the heat. Such will also mean the crops have the opportunity to catch up in their development.
The Canadian dollar remained unchanged by mid-afternoon Tuesday with the loonie holding at 73.35 U.S. cents.
There were 48,156 contracts traded on Tuesday, compared to the 46,229 contracts that changed hands on Monday. Spreading accounted for 21,402 contracts traded.
Prices are in Canadian dollars per metric tonne:
Price Change Canola Nov 632.30 dn 16.10 Jan 641.60 dn 16.60 Mar 649.40 dn 16.40 May 655.70 dn 15.60
SOYBEAN futures at the Chicago Board of Trade fell sharply on Tuesday, as good crop conditions weighed on values.
The United States Department of Agriculture crop progress report said soybean conditions rated 68 per cent good to excellent for the week ending July 7, up one point from the previous week.
Ahead of the USDA’s July supply and demand estimates on Friday, the average trade guess put 2023/24 U.S. soybean ending stocks at 357 million bushels, up two million from last month. The new crop carryover is to be cut by eight million bushels at 447 million.
Dr. Michael Cordonnier of Soybean and Corn Advisor Inc. kept his soybean production estimates Brazil and Argentina at 147 million and 50 million tonnes respectively.
France estimated its 2024/25 rapeseed crop will be 3.94 million tonnes, down from last month’s forecast of 4.20 million.
CORN futures bumped up on Tuesday, aided by spillover from wheat.
Tropical depression Beryl has been forecast to bring much needed rain to the Eastern U.S. Corn Belt, but the western half is to remain drier.
U.S. corn was rated at 68 per cent good to excellent, also up one point from a week ago.
The average trade guess added 25 million bushels to the U.S. old crop corn carryout at 2.05 billion. New crop ending stocks are to rise 158 million bushels at 2.29 billion.
Cordonnier raised his call on total Brazil corn output by two million tonnes at 116 million but trimmed one million tonnes from his estimate on Argentina corn at 46 million.
Reports said Brazil’s safrinha corn will soon hit the global market, negatively impacting more expensive U.S. corn.
WHEAT futures were steady to higher on Tuesday, with small upticks in Kansas City and Chicago wheat.
The USDA reported spring wheat rose three points at 75 per cent good to excellent, while the winter wheat harvest reached 63 per cent done. The latter was up nine points from a week ago and was 11 ahead of the five-year average.
Ending stocks for 2024/25 U.S. wheat are expected to increase by 27 million bushels at 785 million.
IKAR said export prices for 2024/25 Russian wheat dropped US$10 per tonne over the last week, now at US$216/tonne free-on-board due to harvest pressure. Meanwhile, SovEcon placed its export prices at US$221 to US$224/tonne FOB, down five to six dollar from the week before.
France reported its soft wheat crop is expected to drop 15 per cent in 2024/25 at 29.65 million tonnes due to heavy rains that have reduced yields and planted area.
