It was a fairly quiet period in grain and oilseed markets during the week ended April 10, with most futures prices moving lower amid a choppy spring pattern.
The U.S. Department of Agriculture’s monthly supply-and-demand report was released April 9, providing some temporary direction for values, but the data was all for the 2014-15 crop year, and traders are now waiting for a clearer picture on the new crop before making any big moves.
Canola futures were down about $10 per tonne compared to the week prior, but have yet to break out of their recent range between C$450 and $470 per tonne.
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Weakness in outside oilseed markets, including the Chicago soy complex, weighed on canola, as did the large global oilseed supply situation and bursts of strength in the Canadian currency.
While the market is apt to continue following outside oilseeds and reacting to any moves in the Canadian dollar, the main focus is shifting toward spring weather conditions.
Some very early seeding was already starting in southern Alberta during the week, with more provincewide activity expected closer to mid-April.
Favourable weather has also been seen in Manitoba and Saskatchewan, though it’ll likely be closer to late April before farmers in those provinces get seeding underway.
How many acres will be seeded to canola in Western Canada this spring remains to be seen, but general expectations call for area similar to the 2014-15 growing season.
The main focus going forward for Chicago corn and soybean markets will also be planting conditions, as any delays in corn planting could result in larger soybean area.
Corn futures finished seven to 10 cents (US$) per bushel lower during the week, as global supplies of the commodity remain large and export demand is weak. Soybeans were 29 to 36 U.S. cents softer, mainly due to the large global supply situation, expectations of record-large U.S. acreage and positive conditions for South America’s bean harvest.
Both markets remained within recent ranges during the week as well, searching for fresh news about upcoming U.S. crops.
Bumpy ride
As weather conditions can vary greatly, so can futures prices, which was the case for U.S. wheat markets during the week. Concerns about dry weather damaging winter wheat crops in the country would push prices higher one day; forecasts calling for beneficial rain would drive them down the next.
If the wheat markets’ recent action is any indication, North American grain and oilseed markets could be in for a bumpy ride this spring. So far, conditions look fairly good in most regions for spring planting and early development, but weather and production outlooks can change from day to day throughout the growing season.
