North American grain/oilseed review: Canola drops to fresh lows

By Phil Franz-Warkentin

Glacier FarmMedia MarketsFarm—The ICE Futures canola market fell sharply lower on Thursday, setting fresh contract lows as bearish technical signals countered any support from gains in the Chicago soy market.

Updated supply/demand numbers from the United States Department of Agriculture were generally neutral for the soy market, with yield estimates unchanged on the month. Soybeans settled with solid gains after an initial bearish reaction to the data.

However, speculators remained on the sell side of the canola market despite the strength in soybeans, with November canola hitting the weakest level for the front-month contract in nearly four years.

Seasonal harvest pressure and a lack of significant end user demand, despite canola looking cheap compared to most other oilseeds, contributed to the declines.

The Saskatchewan canola harvest was 28 per cent complete according to the latest provincial report

There were an estimated 51,809 contracts traded on Thursday, which compares with Wednesday when 30,955 contracts traded. Spreading accounted for 31,088 of the contracts traded.

SOYBEAN futures at the Chicago Board of Trade were stronger on Thursday, finding some strength after initially dipping lower following the release of the United States Department of Agriculture’s latest supply/demand estimates.

The agency left its call on U.S. soybean yields unchanged from the August report at 53.2 bushels per acre, with total production down by only three million bushels, at 4.586 billion bushels, due to a small reduction in harvested area. However- that would still be a record large crop and well above last year’s 4.165 billion bushels.

U.S. soybean ending stocks for 2024/25 were down by 10 million from the August forecast, at 550 million bushels, which compares with 340 million for 2023/24.

Weekly U.S. soybean export sales reported in a separate USDA report were at the higher end of trade expectations at about 1.5 million tonnes.

CORN was pressured by an unexpected increase in U.S. yields, but still managed to settle near unchanged.

Average U.S. corn yields at 183.6 bushels per acre were raised by half a bushel from the August estimate, surprising market participants who had generally expected a cut given the hot and dry weather over the past month. Harvested area was left unchanged, with production pegged above trade guesses at 15.186 billion bushels.

U.S. corn ending stocks for 2023/24 were tighter than average trade guesses at 1.812 billion bushels, but new crop carryout was well above market expectations at 2.057 billion bushels.

Weekly U.S. corn export sales of 667,000 tonnes were at the low end of trade guesses.

WHEAT was mixed, with gains in Minneapolis spring wheat and losses in the winter wheats.

U.S. wheat ending stocks for 2024/25 were left unchanged at 828 million bushels, slightly ahead of trade estimates calling for a small cut.

World wheat ending stocks were raised to 257.22 million tonnes, about two million tonnes above average pre-report expectations.

The USDA reported weekly U.S. wheat export sales of 475,000 tonnes.