The Good: A major storm is pushing through the eastern Prairies this afternoon with moderate to heavy rains reported din western Manitoba and eastern Saskatchewan. The rains are expected to continue through Thursday, before the system moves into northern Manitoba and Hudson Bay. The amounts from this system are expected to be mostly in the 15 to 35 mm range. The amounts will not make a huge dent in the subsoil moisture reserves, but any amounts are welcome across the Prairies.
The Bad: After yesterday’s smack down, the fact that canola managed to hold the C$900 per tonne level and close today with a slight gain to settle at C$903.20 per tonne. That should be good news. The problem is that it took European (Matif) rapeseed futures to rally by 0.91 per cent and the December soybean oil contract to rally by 1.26 per cent in order to get a puny rise (C$2.10 per tonne) in the November canola contract. The USDA report caused technical damage to the soybean futures and it will be difficult for canola to rally in the face of soybean weakness.
The Ugly: The corn harvest in the U.S. was 41 per cent complete at the beginning of the week, which is 10 per cent above the five year average. This should mean that the harvest pressure in corn is going to decline in the coming weeks. The USDA report yesterday was negative for corn, but the increased in ending stocks was minor when you look at the big picture. That didn’t stop traders from taking the December contract down another dime per bushel to close at US$5.12 per bushel. That is precariously close to the lows established in mid September. Unfortunately for Western Canadian farmers, wheat contracts followed corn lower today.