North American Grain/Oilseed Review: Uncertainty creates less activity

By Glen Hallick, MarketsFarm

WINNIPEG, July 11 (MarketsFarm) – Intercontinental Exchange (ICE) Futures canola contracts were higher on Thursday, in a light volume of trading.

A Winnipeg-based trader commented he isn’t entirely sure why there has been less activity this week, with spec traders largely absent.

One reason he offered was the uncertainty from the United States, stemming from the country’s frequent wet weather and the U.S. Department of Agriculture’s (USDA) June acreage report. That report contained what has been largely believed to be skewed data, as it didn’t fully account for farmers switching from corn to planting soybeans.

That uncertainty has spilled over into canola, the trader said.

Soil moisture levels have improved across the Prairies due to recent rains. More showers were expected today across northern growing regions, with a few showers in the south.

The USDA issued its monthly supply and demand report today, which had a bullish effect on the Chicago Board of Trade, which spilled over into canola.

There were 10,731 contracts traded on Thursday, which compares with Wednesday when 8,583 contracts changed hands. Spreading accounted for 5,622 contracts traded.

Settlement prices are in Canadian dollars per metric tonne.

Price Change
Canola Nov 447.20 up 1.40
Jan 454.50 up 1.60
Mar 461.30 up 1.80
May 467.10 up 2.10

SOYBEAN futures at the Chicago Board of Trade (CBOT) were higher on Thursday, following the release of the United States Department of Agriculture’s (USDA) monthly World Agriculture Supply and Demand Estimates (WASDE).

Soybeans gained between four to five cents per bushel, as the report had a positive affect across the board. That’s despite the data being based on the USDA’s June acreage report, which has been widely believed to have contained skewed data. That being, the report didn’t fully account for U.S. farmers having switched from corn to planting soybeans. The department will conduct a resurvey and release the report in August.

The July WASDE saw yield projections slipped by one bushel per acre (BPA) to 48.5. Production was lowered by seven per cent to 104.64 million tonnes. Ending stocks dropped 24 per cent to 21.63 million tonnes.

Soybean export sales were nearly 133,360 tonnes of old crop and 130,635 tonnes of new crop, both well under trade expectations and the previous week’s sales.

CORN futures were stronger on Thursday, as the September contract increased nine and quarter cents per bushel, due to the WASDE report.

The USDA kept corn yields unchanged at 166 BPA, with production up nearly five per cent at 352.44 million tonnes. Ending stocks were up 20 per cent at 51.07 million tonnes.

Corn export sales amounted to almost 505,500 tonnes of old crop and nearly 396,260 tonnes of new crop, with both under trade expectations.

WHEAT futures fared the best on Thursday from the WASDE report, with double digit gains in Chicago, Kansas City and Minneapolis.

The USDA predicted total wheat yields to be up by 1.3 BPA to 50.0. Production was raised by almost one per cent to 52.28 million tonnes, with ending stocks up more than 6.5 per cent at 27.22 million tonnes.

The department lowered its estimate of world wheat production by almost 9.40 million tonnes at approximately 771.45 million.

The USDA reported wheat export sales were 285,700 tonnes and below trade estimates.

Commodity Future Prices

Price Change

Prices are in Canadian dollars per metric ton

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