Market Report: June 26, 2024

On Tuesday, the canola markets saw significant downward movement, with the July futures dropping below the significant threshold of $600 per tonne. Contributing factors included sharp declines in the Chicago soy and weaker palm oil and rapeseed market performances. Additionally, concerns about the slow growth of the Prairie canola crop with an absence of significant weather threats, continued to affect the market’s outlook. Barley prices started the week stronger, with a noticeable uptick due to concerns over dry weather across the Canadian Prairies and parts of the European Union. This climatic challenge has threatened to slow crop development and could potentially reduce yields. Initial prices saw an increase, with spot prices reaching up to $215 per tonne, compared to $208 the previous week.

The upcoming acreage report from Statistics Canada, expected on Thursday, is anticipated to show only slight variations from the earlier spring estimate of 21.4 million acres dedicated to canola cultivation and 7.1 million acres dedicated to Barley cultivation.

In recent trading, the July futures experienced a substantial decrease of $16.30, closing at $584.40 per tonne—a new low for the contract. The November futures also fell, dropping $13.50, closing at $604.30 per tonne. Barley futures have mirrored the declines seen in related grain futures. After the initial rise earlier in the week, prices settled lower, reflecting broader market sentiments and adjustments in speculator positions. Futures contracts for July closed at $208 per tonne, down from a high of $215 per tonne, showing a correction after speculative gains.

Today’s trading session saw a modest recovery in canola and Barley futures, with prices rising by $4 to $5 per tonne this morning. The recovery efforts helped the November contract increase by $4.00, reaching $608.30 per tonne and maintaining a position above the $600 mark despite previous lows of around $590 for Canola. Barley futures have mirrored the declines seen in related grain futures. After the initial rise earlier in the week, prices settled lower, reflecting broader market sentiments and adjustments in speculator positions. Futures contracts for July closed at $208 per tonne, down from a high of $215 per tonne, showing a correction after speculative gains.

Investors and traders are keeping a watchful eye on important upcoming reports, including the acreage data from Statistics Canada and the U.S. Department of Agriculture’s acreage and grain stocks report later this week. These publications could significantly impact market dynamics, particularly with speculative funds currently leaning towards a bearish outlook and weather conditions playing a crucial role in shaping summer crop yields.

Overall, the prospects for the new crop are generally positive, although the development is somewhat delayed compared to average years. The full extent of damage from recent severe weather events in eastern Saskatchewan is still being assessed.

Because Farming is Forever,
Leston Alvarez

We want to inform you that Agfinity will be closed on Monday, July 1, 2024, in observance of Canada Day. We will resume normal business operations on Tuesday, July 2, 2024.

We hope you all enjoy a wonderful holiday filled with celebration and joy. Thank you for your continued support, and we look forward to reconnecting after the holiday!