Glacier FarmMedia COVID-19 & the Farm

Experts

 

The Good, Bad & Ugly

The Good, Bad & Ugly

The Good: Canola futures continue to display some independence from outside markets as the nearby January contract closed up C$20.60 per tonne on the day. The January contract settled the day at C$990.80 per tonne which is a new contract high. Soybean futures were up eight to nine cents per bushel, which provided some support, while soybean oil traded essentially flat on the day with the nearby December contract up 0.03 per cent on the day. Canola appears to be playing ping-pong with European rapeseed futures.  European finished their trading day at a new contract high of 695.75 Euros per tonne. European futures are still close to a C$40 per tonne premium to ICE canola.

The Bad: The winning streak in the spring wheat market was broken today as the nearby December contract finished unchanged at the end of the session. This is actually a good news scenario as wheat markets traded mostly lower during most of the trading session. Kansas City and Chicago wheat contracts ended the day five to six cents per bushel lower. Spring wheat closed the day at C$10.76 per bushel, which is still at a contract high. Call it a win for spring wheat in today’s trading session.

The Ugly: The Chinese government warned consumers to “stock up” on foodstuffs for the winter. Call it China’s toilet paper moment, but when the Chinese consumer is called on to stock up on food, that will lead to some large changes in demand over the next few months. The reason for the concern is the heavy rains in central China over the past two months have caused problems for both the crop and vegetable markets. The vegetable shortages are significant as meat prices are already high in China and as a result vegetable consumption has increased. This food shortage in China is a big concern as we head into the winter period and will likely cause even more volatility (both up and down) in commodity markets.