The Good: This was a volatile week, but canola closed on a high note with January 2021 futures closing at C$542.60 per tonne. The canola contract has moved past the September highs, which is a technically significant event. Canola exports are 747,600 tonnes ahead of last year’s pace with a total of 2.76 million tonnes so far this crop year. Needless to say, demand remains strong.
The Bad: Although spring wheat futures closed unchanged to slightly higher today, but Chicago wheat futures closed down five cents per bushel. Most of the speculative money in wheat is in Chicago and the market remains long, despite the moves this week. On October 27th, money market funds in Chicago wheat futures were net long 48,886 contracts. That was down only 832 contracts from the previous week.
The Ugly: Crude oil futures have had the sharpest drop since mid April, when the market hit the contract lows. This is obviously good news for petroleum consumers, but the drop in oil does impact biodiesel and ethanol. The main concern is that the economy may slow due to the COVID-19 outbreaks in Europe and North America which will impact crude oil use.