The Good: Today was supposed to be a “sell the fact” day today. The forecasts on Friday were studded with wind and potential freeze warnings on the weekend, so the markets should have adjusted appropriately to the information. Obviously a lot of traders took the day off and pushed buy orders into the canola market today. November canola closed the day at C$510.90 per tonne which is the highest level since early July in 2018. MarketsFarm has issued a sales alert for canola today to reward the rally.
The Bad: Well the frost came on Sunday morning and Monday morning across the Prairies. The temperatures dropped to as low as -7.9 C in southcentral Saskatchewan this morning. The map below shows the minimum temperatures to Monday morning for the previous week. Most of the Prairies has experienced freezing or near freezing temperatures this past weekend. Let’s not forget the winds that were generally in the 50 to 65 kph range. Fall weather is now here in spades!
The Ugly: Certainly the oil market is the ugliest commodity market of the day with nearby contracts dropping by nearly seven per cent. The chief concern in the oil markets are large global inventories combined with decreased demand in the shoulder season. The Labour Day holiday marks the end of the summer driving season. As refineries retool for the production for winter gasoline and diesel, demand for crude oil drops. Extended refinery shutdowns could be expected this year as refinery margins are very poor. Certainly there is no reason for the diesel and gas prices to move higher over the next few weeks.