By Glen Hallick, MarketsFarm
WINNIPEG, June 11 (MarketsFarm) – New crop canola contracts tumbled on the Intercontinental Exchange (ICE) on Friday, following more Prairie rainfall overnight and earlier today.
Although the declines took a good chunk out of the weather premium, a trader said some of the premium still remains.
Steep losses in Chicago soybeans and soyoil helped to pull down canola. Additional pressure came from significant losses in European rapeseed and Malaysian palm oil.
With warmer temperatures and little rain forecast for the Prairies next week, dry conditions could again be a major factor in canola prices.
The tight supply situation for canola was still looming in the background, as it tempered further losses.
Alberta reported today that almost 91 per cent of its crops province-wide have emerged, with canola at about 87 per cent.
At mid-afternoon the Canadian dollar was down sharply, with the loonie at 82.17 U.S. cents compared to Thursday’s close of 82.69.
There were 18,097 contracts traded on Friday, which compares with Thursday when 30,322 contracts changed hands. Spreading accounted for 7,178 contracts traded.
Settlement prices are in Canadian dollars per metric tonne.
Canola Jul 871.00 dn 0.80
Nov 744.30 dn 17.00
Jan 744.80 dn 18.20
Mar 741.40 dn 19.90
SOYBEAN futures at the Chicago Board of Trade fell hard on Friday, due to changes in yesterday’s supply and demand estimates from the United States Department of Agriculture (USDA).
In that report, the department projected the U.S. soybean crush to pull back to 2.175 billion bushels in 2020/21, which resulted in large losses in Chicago soyoil on Friday.
Also, the USDA raised its call on the 2020/21 global soybean carryover by 1.68 per cent at 88 million tonnes and by 1.6 per cent on the new crop carryout at 92.55 million tonnes. As for the U.S. market share of the global soybean trade, the department expects it to shrink from 36.2 per cent to 32.6 per cent.
The Buenos Aires Grain Exchange (BAGE) said 99 per cent of Argentina’s soybean crop has been harvested and pegged production at 43.5 million tonnes.
CORN futures were weaker on Friday, on news regarding the Renewable Fuel Standard.
Reuters reported that U.S. President Joe Biden could flip-flop on his campaign pledge to roll-back the number of waivers from the Renewable Fuel Standard the Trump administration gave to refineries. The report said Biden is getting strong pressure from refinery workers as well as a number of politicians. Biden made the promise in hopes of currying favour with U.S. farmers.
At 35 per cent, the U.S. weekly drought monitor cited an 11 point increase in the amount of corn area experiencing some form of drought.
Due to severe drought, CONAB slashed the Brazil safrinha corn crop by 9.8 million tonnes on yields of 10.16 bushels per acres.
The BAGE upped its call on the Argentina corn crop by 4.3 per cent at 48 million tonnes. Also the BAGE said the country’s corn harvest was almost 39 per cent complete.
WHEAT futures were lower on Friday, after rain fell on the U.S. Northern Plains.
In yesterday’s supply and demand report, the USDA upped the winter wheat yield by 2.1 per cent at 53.2 bushels per acre.
The USDA projected Russia’s wheat crop to be 86 million tonnes. In comparison, SovEcon has called for 82.4 million tonnes and IKAR was at 82 million.
Russia said it’s raising its export tax on wheat by US$3.90 at US$33.30 per tonne from June 16 to 22.
France reported its soft wheat crop was 81 per cent good to excellent, up one point from the previous week. A year ago it was 56 per cent.
Futures Prices as of June 11, 2021
Prices are in Canadian dollars per metric ton