Canola in the News

Agriculture markets eye normality as countries ease export restrictions

03/06/2020 

Topic: Agriculture markets move towards normality as export restrictions are eased

In an analysis of data released by the UN’s Food and Agriculture Organization, S&P Global Platts reports more than 90 countries revealed that cereal complex prices increased in March and April 2020. In response to price warnings and the threat of food insecurity, many countries have put measures in place to limit exports, sell grain from government stocks, reduce import duty to manage food inflation, and implement price ceilings. Russia and Commonwealth of Independent States countries have imposed stronger measures that limit agricultural exports, while North African countries increased imports and relaxed restrictions to secure supplies. In an interview with Abdolreza Abbassian, senior economist with the Food and Agriculture Organization, Abbassian tells S&P Global Platts that major exporting countries are looking towards normality despite current curbs on grain exports. The bigger concern for the grains and oilseeds complex is the loss of demand following the impact of COVID-19 on the agriculture industry.

FAO Food Price Index falls to 17-month low

05/06/2020

Topic: Food and Agriculture Organization Food Price Index falls to 17-month low

The Food and Agriculture Organization (FAO)’s Food Price Index, which tracks international prices of commonly traded food commodities, averaged 162.5 points in May 2020, the lowest reading since December 2018 according to a June 5, 2020 report. The FAO Dairy Price Index declined 7.3 percent from April, while the FAO Sugar Price Index rose 7.4 percent from April. The FAO Cereal Price Index declined 1 percent from April; the FAO Vegetable Oil Index fell 2.8 percent to a 10-month low; and the FAO Meat Price Index fell by 0.8 percent in May. FAO’s Cereal Supply and Demand Brief reports that global cereal production is projected to reach a new record level of 2,780 million tonnes, which is 2.6 percent higher than the 2019/2020 cycle. The FAO also expects world cereal trade in 2020/2021 to rise by 2.2 percent to 433 million tonnes.

Bin-busting harvest in Canada seen adding to global wheat supply

05/08/2020

Topic: Canada anticipates adding to global wheat supply after huge harvest

According to the results of a crop tour of Manitoba, Saskatchewan, and Alberta  organized by FarmLink, Canadian wheat production is expected to reach 31.9 million metric tonnes, up 16 percent from last year and the biggest harvest in history. The data, compiled over a 12-day period in July by crop scouts, revealed that crops are “in better shape with more yield potential compared to a year earlier.” The harvest would be adding to a global glut of wheat this year. Durum output is forecast as 7 million tonnes, a 41 percent increase from the year earlier, while Canola production is forecast as rising to 20.2 million tonnes, up 8.5 percent from the year earlier.

World food price index rises in July, extending rebound

07/08/2020

Topic: UN Food and Agriculture Organization report rising world food prices rise in July

In an extension of a rebound from the previous month following falls triggered by the pandemic, world food prices rose in July. The UN’s Food and Agriculture Organization’s food price index, which measures monthly changes for cereals, oilseeds, dairy products, meat, and sugar, averaged 94.2 points in comparison to a slightly revised June figure of 93.1 points. The vegetable oil price index climbed 7.6 percent in July, reaching a five-month high, while the dairy price index rose by 3.5 percent to climb above the pre-pandemic level. Sugar prices rose by 1.4 percent, whereas the meat index dropped by 1.8 percent and was 9.2 percent below the level recorded in the previous year as a result of global demand disrupting availability. The cereal index remained almost unchanged despite gains for maize and sorghum as a result of Chinese purchases from US suppliers.

Canadian wheat crop looks biggest in seven years, canola harvest smaller

02/09/2020

Topic: Canadian wheat crop harvest biggest in seven years

Statistics Canada announced that Canadian farmers are set to harvest the biggest wheat crop in seven years at 35.7 million tonnes, with slightly less canola. This bigger wheat production was driven by a 90 percent jump in durum output. However, traders are sceptical of the high wheat estimates, with some having stated that Statistics Canada’s modelling, which used satellite technology that incorporated data up until July 31, ended too early to record a heatwave that lowered yields. On the other hand, canola production was set to reach 19.4 million tonnes in the 2020-21 marketing year, which is smaller than last year’s 19.5 million and below the average trade guess of 20 million tonnes.

Funds plant first bullish CBOT corn view since Aug. 2019

09/09/2020

Topic: Funds plant bullish CBOT corn, wheat, soybean views

According to Reuters, as of 1 September, investors held net longs across CBOT corn, wheat, soybeans and soybean products, and Kansas city wheat—the likes of which have not been seen since 2015. Reuters writes, “they maintain bearish views in Minneapolis wheat, though they are the most bullish toward combined CBOT grains and oilseeds for the date since 2012.” Data published by the US Commodity Futures Trading Commission noted that money managers “dumped” approximately 136,000 short positions across these seven grains and oilseeds, with the remaining total of 378,580 being the funds’ fewest number of shorts since July 2017. Funds also added about 86,000 gross long positions, the most for a week since March 2018, setting the new number of total longs at 682,851—the highest since August 2018. Hedge funds and other money managers switched to a new long in CBOT corn futures and options of 18,659 contracts in the first week of September. For soybeans in the first week of September, money managers extended their net long in CBOT soybean futures and options to 162,607 contracts from 109,288 contracts a week earlier. Also in the first week of September, investors boosted their net long in soybean meal futures and options to 15,871 contracts from 3,560 a week prior and their net long in soybean oil futures and options to 81,557 contracts from 67,690 a week prior. For wheat in the first week of September, money managers net long in CBOT wheat futures and options rose to 32,469 contracts from 1,517 contracts a week earlier. Minneapolis wheat remains the only grain approached with pessimism by investors.