The Good: The good news today was limited, so the good news today is that hurricane Zeta is currently piling into the Louisiana coast with 110 miles per hour winds. Now this might not seem as very much in the way of good news, but the hurricane is expected to move onshore quickly and move into central Alabama by tonight. This will mean that the disruption to shipping and oil infrastructure in the Gulf will be limited. This has been a record setting year for named storms, with Louisiana bearing the brunt of the hurricane activity this year. The U.S. hurricane season should wind down over the next few weeks as sea surface temperatures begin to cool in the Atlantic and Caribbean nursery areas that spawn tropical storms.
The Bad: Spring wheat futures dropped nine cents per bushel (1.7 per cent) in today’s trade, which has almost totally eliminated the rally that began close to two weeks ago. The market has stopped at key resistance levels and much of the action today was hot money moving out of markets as the sentiment certainly moved to risk off. The fundamental news has seen soil moisture conditions improve in Argentina, Russia and the Southern Plains in the U.S., but demand for wheat remains strong and the market just made it cheaper in the past four days.
The Ugly: Canola was taken out to the woodshed and beaten with the ugly stick today. Nearby January canola dropped 1.54 per cent to C$535.40 per tonne. The market did recover from lows established during the trading session and managed to close the day at technical support levels. As with the wheat market, canola has erased the gains of the latest rally, but the supply and demand fundamentals remain the same. Demand is strong and export shipments of canola remain at near record levels during the first quarter of the crop year.