Market Report: July 31, 2024

As the Prairies bask in unseasonably warm temperatures with highs reaching the upper 20s and low 30s, the heatwave is making waves beyond just the weather.  

Crop conditions have dropped significantly from 73% good to excellent last week to 55% this week, falling below the 5- and 10-year averages. Despite cooler temperatures early in the growing season, the recent prolonged heat has negatively impacted crop conditions, with most regions still in need of precipitation. Current moisture ratings are lower, with surface soil moisture at 35% good to excellent and sub-surface moisture at 30%, down from 61% and 47%, respectively. Crop development is slightly ahead of average, with most crops nearing the end of flowering, though rain and cooler temperatures in the forecast might take a few weeks to show their full effects. 

Canola futures are experiencing downward pressure in early trading, with nearby contracts falling by C$14.80 to C$620.10 per tonne. The decline is attributed to a broader trend in the market, as soybean futures are down 17 to 18 cents per bushel, contributing to the pressure on canola. Additionally, lower soybean and palm oil futures are impacting canola prices. European rapeseed futures are down 0.65% at midday, further influencing the canola market. The current momentum suggests that canola prices might test the C$600 per tonne threshold. 

Corn prices fell to fresh contract lows, pressured by the absence of major weather threats. The U.S. corn crop is now rated 77% good-to-excellent, up one point from last week. In Brazil, the second corn crop harvest is ahead of schedule, now 91% complete. 

Wheat prices decreased due to seasonal harvest pressure and strong export competition from Russia. The U.S. winter wheat harvest is 82% finished, slightly ahead of average, while spring wheat’s good-to-excellent rating dropped to 74%. Lower production estimates from France, potentially the smallest in 40 years, provided some support. 

Because Farming is Forever,
Maddy

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