The Good: The market seemed to pay attention to the dryness in the main growing areas of the Prairies today. The November 2021 canola contract closed the session at C$651.90 per tonne which is a new contract high for the contract. New crop cash bids have pushed close to the C$15 per bushel level for fall delivery in western areas and C$14.50 per bushel in the eastern growing areas. Although the price increase did not really change the price relationship between old and new crop contracts. The spread between the July and November contract closed at C$118 per tonne and hasn’t really moved out of the range of C$100 to C$130 per tonne over the past two months. Although the move higher in the November contract is nice, the market really hasn’t changed its opinion on the weather risk for the 2021 crop.
The Bad: Spring wheat futures did not display any inclination to move higher today with the July contract closing at US$6.71 per bushel. The momentum in the wheat market was subdued by corn futures, which were off three to four cents per bushel in today’s trade. U.S. HRS shipments were relatively strong during the past week at 129,324 tonnes, but export sales produced net cancellations. Compare that with the Canadian wheat (ex durum) exports last week of 456,200 tonnes. Canadian wheat exports so far this crop year have reached 13.713 million tonnes, which is 2.8 million tonnes ahead of last year.
The Ugly: Don’t get me wrong, the snow/rain event earlier this week provided much needed moisture in parts of the eastern growing areas of the Prairies. The heaviest amounts fell in eastern Saskatchewan and eastern Manitoba. The problem is that over the past 30 days most of the Prairies are still reporting precipitation amounts that are below average. This means that the precipitation event was no a huge game changer for soil moisture reserves, except in parts of eastern Saskatchewan and eastern Manitoba.