The Good, Bad and Ugly publication times will change slightly over the next couple of weeks as I participate in the “Harvest from Hell-2019” mop up operations. Jumping off the combine at 11:00 pm does not usually result in a coherent summary of the trading day.
The Good: Canola markets have held the important technical levels and are poised to move higher if we get one good piece of information from the USDA report. New crop canola futures (November) closed yesterday at 276.80 per tonne which is higher than the C$475 per tonne level that marked the 40 day moving average.. The next level of resistance is in the C$478 to C$480 per tonne level.
The Bad: U.S. corn planting hit 67 per cent complete, which is over double the pace of last year. The rapid progress means that the markets will now focus on the potential for huge production and ending stocks this year. A 15.5 billion bushel crop with 3.5 to 4.0 billion bushel ending stocks is the prescription for lower prices in feed grains, wheat and even oilseeds. The 2020-21 crop year is shaping up as one to forget fr a price point of view.
The Ugly: For all the spring harvest folks – the quality of the spring harvest is the ugly for today. The canola and cereal crops have taken a beating over the winter and the grade show it. The smoke from fields burning in the distance says it all about the quality of the crops. Some of the basis improvement in the past week has been due to the fact that people are finally realizing that the supplies of quality cereals and oilseeds is tighter than the trade thinks.