The Good: Soybean meal futures continued the rally that started during the middle of August. The rally has been very impressive and has been driven by Chinese demand for protein meals. Canadian pea exports totalled 69,200 tonnes during the week ending on October 18th thanks to the strength of the protein meal market in China. Bulk pea exports now total 1.03 million tonnes 11 weeks into the crop year.
The Bad: The spring wheat rally took a pause today as the nearby December contract dropped eight cents per bushel to US$5.745 per bushel. Spring wheat trade was volatile today with the nearby contract spending most of the first half of the session higher than yesterday’s close. The market did sell off at the close and finished near the daily lows.
The Ugly: U.S. spring wheat exports during the past week (ending October 15th) dropped to 78,870 tonnes. Strong exports of soybeans from the PNW have reduced opportunities for spring wheat exporters and this will likely continue over the next few months. As a comparison, Canadian exports for the past week (ending October 18th) for CWRS were 481,200 tonnes for the week. Despite the drop in U.S. exports, the spring wheat export pace is the best in four years. The drop in spring wheat exports were negative for spring wheat futures, it does present an opportunity for Canadian exports.