By Glen Hallick, MarketsFarm
WINNIPEG, August 21 (MarketsFarm) – Intercontinental Exchange (ICE) Futures canola contracts were higher on Wednesday, although markets continue to lack direction prior to harvest.
A trader said the canola harvest has yet to get underway across most of the Prairies, with crops more and more behind as one travels west. The exception was the Winnipeg area, of which he noted the canola appeared to be very good as it was combined.
Earlier today, Agriculture and Agri-Food Canada (AAFC) issued its August production estimates with few changes for canola. Production remained at July’s forecast of 18.575 million tonnes, and below 2018’s crop of 20.343 million. Exports as well stayed at 9.000 million tonnes, below last year’s 9.500 million.
There was a change to the AAFC’s ending stocks; with the August projection at 3.775 million tonnes of canola compared to July’s 3.975 million. Ending stocks for 2018 were 3.700 million tonnes.
There were 13,019 contracts traded on Wednesday, which compares with Tuesday when 12,010 contracts changed hands. Spreading accounted for 4,282 contracts traded.
Settlement prices are in Canadian dollars per metric tonne.
Canola Nov 453.10 up 1.70
Jan 460.50 up 1.60
Mar 466.80 up 1.50
May 472.30 up 1.60
SOYBEAN futures at the Chicago Board of Trade (CBOT) were stronger on Wednesday, as the second day of the Pro Farmer Midwest Crop Tour discovered lower pod counts.
The average pod count by the tour’s western leg in Nebraska was estimated at 1,211 pods within three by three-foot squares in fields throughout the state. That’s down from 2018’s average of 1,299 pods. The eastern leg in Indiana found average pod counts of 924 versus 2018’s average of 1,312. The tour continues until Thursday.
Ahead of the United States Department of Agriculture’s (USDA) weekly export sales report, trade expectations for soybeans were minus 200,000 to plus 100,000 tonnes of old crop and 350,000 to 700,000 tonnes for new crop. Predictions for soymeal were 100,000 to 350,000 tonnes and soyoil at 5,000 to 25,000 tonnes. The USDA releases its report Thursday.
CORN futures were higher on Wednesday, also on lower yield projections from the Pro Farmer tour.
The tour estimated Nebraska corn yields at 172.55 bushels per acre, 13.45 bushels under the USDA’s estimate in its August supply and demand report. Indiana corn yields were estimated to be 161.5 bushels per acres, which was 5.5 bushels less than the USDA’s estimate.
Market predictions for export sales were 50,000 to 400,000 tonnes for old crop corn and 200,000 to 600,000 tonnes for new crop.
The U.S. Energy Information Administration (EIA) released its weekly ethanol report today, and production was down 22,000 barrels per day for the week ending August 16, the lowest output since April. Stock fell 516,000 barrels to 23.37 million.
Biofuel producer POET will cut ethanol production at half of its biofuel refineries, according to a report. Company officials blamed the Trump administration for undermining the Renewable Fuel Standard. That standard provided waivers meant for small refineries, but were now granted to large oil companies. Also, Marquis Energy announced it has cut production at their Wisconsin ethanol plant.
The USDA reported a private sale of 328,000 tonnes of corn to Mexico today, with delivery during 2019/20.
South American corn exports have been at a brisk pace so far in August. As of August 19, Brazil exported 4.60 million tonnes, and Argentina stood at 1.70 million tonnes.
African swine fever was reported in Russia’s Amur region, close to China’s northwest border. The deadly disease has ravaged the hog industries in China and Vietnam and been reported in several East European countries.
WHEAT futures were mostly lower on Wednesday, due to U.S. wheat not being competitive on the global market.
Market expectations for export sales were 300,000 to 500,000 tonnes.
The AAFC reported its August estimate for total Canadian wheat production at 32.500 million tonnes, for an increase of 500,000 tonnes from the department’s July estimate. For 2018/19, wheat production totaled 31.769 million tonnes.
As well, the AAFC upped its estimate of total wheat ending stocked to 5.500 million tonnes from July’s 5.100 million. Ending stocks for 2018/19 were at 5.200 million tonnes.