North American grain/oilseed review: Canola boosted by Mideast tensions

By Phil Franz-Warkentin

Glacier FarmMedia MarketsFarm—The ICE Futures canola market was stronger on Tuesday, nearing chart resistance as activity resumed after Monday’s National Day for Truth and Reconciliation.

Reports that Iran launched a ballistic missile attack on Israel sent crude oil climbing higher, with world vegetable oil markets also rising amid the escalating conflict. European rapeseed and Malaysian palm oil were up on the day. However, Chicago soyoil backed away from its own gains, tempering the upside in canola.

Ideas that Canadian canola yields may not live up to the official expectations were also supportive, with provincial estimates and anecdotal reports generally coming in below the official Statistics Canada data.

Striking grain workers at the Port of Vancouver reached a tentative deal over the weekend, taking some uncertainty out of the canola market.

There were an estimated 68,186 contracts traded on Tuesday, which compares with Friday when 53,768 contracts traded. Spreading accounted for 38,630 of the contracts traded.

SOYBEAN futures at the Chicago Board of Trade settled with small gains on Tuesday, as unrest in the Middle East and dryness concerns delaying seeding operations in Brazil provided support.

Meanwhile, strikes at ports along the United States East Coast and Gulf of Mexico could disrupt grain movement from the country if the labour dispute lasts for any significant time.

The U.S. soybean harvest was 26 per cent complete as of this past Sunday—eight points ahead of average for this time of year. Condition ratings for the crop were left unchanged at 64 per cent good-to-excellent.

The U.S. Department of Agriculture announced private export sales of 120,000 tonnes of soybeans to unknown destinations.

CORN saw a continuation of Monday’s rally, with the gains in crude oil also supportive.

The U.S. corn harvest was 21 per cent complete in the latest weekly report, running three points ahead of average. The good-to-excellent rating dipped one point to come in at 64 per cent.

Flash sales of 195,000 tonnes of corn to unknown destinations were supportive.

Quarterly stocks data released Monday showed 1.76 billion bushels of corn on hand in the U.S. as of Sept. 1. That was up by about 400 million on the year, but still below average trade expectations.

WHEAT futures were sharply higher, with declining production estimates out of Ukraine and quality issues in Europe contributing to the gains.

The U.S. winter wheat crop was 39 per cent planted, one point ahead of average.

Monday’s small grains summary pegged U.S. wheat production at 1.971 billion bushels, which was down from the August estimate but slightly ahead of average trade guesses.