North American Grain and Oilseed Review: A turnaround Tuesday for canola

There was a dramatic turnaround on Tuesday in Intercontinental Exchange (ICE) canola futures, erasing double-digit losses to end with moderate increases.

There was a similar occurrence with the Chicago soy complex, that saw large declines in soybean almost evaporate. Meanwhile soyoil ended relatively steady and soymeal finished off its lows. That reduced pressure benefitted canola.

However, there were double-digit losses in European rapeseed and smaller losses in Malaysian palm oil. A sharp downturn in global crude oil prices weighed on vegetable oils.

The Prairie forecast has called for warmer temperatures and little, if any, rain for the rest of the week. That will bode well for harvest progress across the region.

The Canadian dollar is weaker at mid-afternoon as the loonie pulls back to 76.30 U.S. cents, compared to Monday’s close 76.87.

There were 26,724 contracts traded on Tuesday, which compares with Monday when 19,818 contracts changed hands. Spreading accounted for 17,632 contracts traded.
Settlement prices are in Canadian dollars per metric tonne.

Price Change
Canola Nov 843.80 up 5.30
Jan 851.80 up 6.00
Mar 857.50 up 6.00
May 857.90 up 4.90

SOYBEAN futures at the Chicago Board of Trade (CBOT) were lower on Tuesday but finished well off of its lows.

The United States Department of Agriculture (USDA) issued its crop progress report on Monday afternoon. For the week ended Aug. 28 soybeans remained at 57 per cent good to excellent. Soybeans setting pods were up seven points on the week at 91 per cent, slightly below the five-year average. Soybeans dropping leaves were reported for the first time this year and registered at four per cent, almost half of the average.

The USDA reported a private sale of 240,000 tonnes of new crop soybeans to unknown destinations.

Dr. Michael Cordonnier of Soybean and Corn Advisor Inc. kept his estimate of U.S. soybean yields for 2022/23 at 50.4 bushels per acre. That’s 1.5 bu./ac. below the current USDA estimate.

Abiove estimated the 2022/23 soybean crop in Brazil at 151 million tonnes, while Datagro pegged it at 151.8 million.

CORN futures were lower on Tuesday, due to pressure from wheat.

The USDA pegged corn at 54 per cent good to excellent, slipping one point from last week. Corn dough was up 11 points at 86 per cent, just behind the five-year average. Corn dented improved 15 points at 46 per cent, six points behind the average. Corn mature doubled to eight per cent, a pinch behind the usual pace.

Very little rain is in the U.S. weather forecast west of the Mississippi River for the remainder of the week. The heat is expected to remain in the Corn Belt through the first week of September.

At 170 bu./ac., Cordonnier trimmed three bu./ac. from his forecast on U.S. corn yields.

Datagro projected total 2022/23 corn production in Brazil at 120.5 million tonnes, with the first crop accounting for 21.4 per cent of total output. AgRural said the current Brazil corn harvest reached 94 per cent complete, gaining five points on the week.

Due to dry conditions in the European Union, France reported its corn crop fell to 47 per cent good to excellent this week, which marked the lowest rating in 11 years. Meanwhile, Romania said it’s very likely its corn harvest could start a month early.

South Korea purchased 133,166 tonnes of corn, likely from either South Africa or South America.

WHEAT futures were weaker on Tuesday, due to improved weather and the potential for large yields.

The U.S. spring wheat harvest advanced 17 points to reach the halfway point, but that’s 21 behind the five-year average. Spring wheat rated 68 per cent good to excellent, up four on the week.

Reports said there are indications that Russia might not agree to extend the Black Sea corridor for Ukrainian grain exports past October. This comes just as Ukrainian military is poised to retake the Kherson region from Russian forces.

The Romanian wheat harvest produced about nine million tonnes, 15 per cent less than last year.

Tags: corn, vegetable oils, canola, prices, soybean, wheat, soyoil, rapeseed, palm oil, futures, soymeal