Wittal: Rising loonie drags on canola

Our online grain markets columnist Brian Wittal welcomes feedback and information on market conditions in your area, such as current offering prices, basis levels, trucking premiums and special crops contracts. Contact Brian today.

Improved weather over the weekend in the U.S. allowed farmers to get serious about seeding. Getting the corn seeded is Priority 1 due to the late start this spring, so as corn acres go in, corn futures will come under pressure and then fewer acres will need to be converted over to beans, which will help to keep bean futures strong.

Wheat futures gave back some of Friday’s big gains as weather on the weekend co-operated for the most part, allowing seeding to progress. Calls for rain this week in some of the central and northern Plains regions may stall seeding yet again and if that happens we may see a further jump in wheat futures.

The Dow Jones closed up 179 points today, while the U.S. dollar finished down seven-10ths of a cent. The Canadian dollar was up 0.46 cents today to close at US84.96 cents.

Crude oil finished up $1.27, closing at US$54.47 per barrel for the day.

Corn finished down seven to nine cents per bushel today, beans finished down two to up 14 cents per bushel, and wheat finished down five to 19 cents per bushel. Canola is up $8 to down $3 per tonne for the day and barley is unchanged, closing at $141 per tonne.

The dropping U.S. dollar and the continued surge in the Canadian dollar have canola struggling to keep pace with bean futures, and now, as seeding becomes fairly general across the Prairies, canola is going to struggle to stay at these current futures levels unless our dollar starts to back off soon.

Canola deliveries to elevators are almost non-existent right now and that should help to keep basis levels attractive for the near term and maybe help to keep futures values up as companies try to buy needed stocks for immediate shipping.

That’s all for today. — Brian

— Brian Wittal has spent over 27 years in the grain industry, including as an elevator manager and producer services representative for Alberta Wheat Pool, a regional sales manager for AgPro Grain and farm business representative for the Canadian Wheat Board, where he helped design some of the new pricing programs. He also operates his own company providing marketing and risk management advice for Prairie grain producers. Brian’s daily commentaries focus on how domestic and world market conditions affect you directly as grain producers.

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