Stats Can Bullish or Bearish for Canola?

On Wednesday, Statistics Canada released their planted acres report. 

Canadian farmers reported planting more wheat, canola, barley, corn and soybeans, but fewer acres of oats, lentils, and dry peas.

Canola seeded acres were reported to be higher as well.

Farmers reported planting 22.1 million acres of canola in 2023, up 3.2% from the previous year. 

This is higher than last April's Stats Can report of 21.597 million acres.

Overall, the higher acres might be bearish for canola.

However, there are a lot more factors to consider than just the acres.

The USDA report yesterday had a few surprises on the soybean front, which has propelled canola to break higher on the charts. 

I believe for farms that don't have much priced or are unsure about their crop using options to protect may be a good idea.

Canola November Futures - 1 Year

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Wheat

Statistics Canada reported wheat acres were at the highest level in more than two decades.

Nationally, farmers reported planting 26.9 million acres of wheat in 2023, up 6.7% from 2022. 

In 2023, greater total wheat area was led by spring wheat area, up 8.0%, and durum wheat area, up 0.5%.

Saskatchewan wheat area increased 6.9% to 14.2 million acres, as spring wheat area rose 10.0% to 9.1 million acres and durum wheat area grew 2.2% to 5.0 million acres.

Alberta producers reported planting 7.9 million acres of wheat, up 4.4% from 2022, led by greater spring wheat area, which increased 6.4% to 6.8 million acres in 2023.

Durum wheat area in the province fell 8.3% to 996,800 acres.

Farmers in Manitoba reported that total wheat seeded area increased 7.2% to 3.3 million acres.

Minneapolis wheat futures have been trading sideways for the last few months. 

The USDA reported was neutral wheat with planted acres and stocks around expectations. 

I have been looking at new crop option protection strategies using the Kansas City contract. 

Minneapolis Wheat September Futures - 1 Year

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Kansas City Wheat September Futures - 1 Year

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Chicago Wheat July Futures - 1 Year

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Corn

The USDA report showed for corn higher planted acres and lower stocks than expected.

Overall, it was a bearish report given the acres. 

A Reuters study indicated that the June report results in a average price move in December corn of 5.4% on the day of the report release.

Adding to the potential for extreme volatility are the most USDA drought monitor charts, which showed abnormally dry, moderate drought and severe drought areas in high producing areas remained in place as of June 27th.

The extremely poor crop condition readings resulting in an extremely poor start and the USDA indicating 70% of US corn production was in drought areas could lead to permanent yield losses.

While today's USDA report was important many traders are saying that Monday's crop conditions report is the one to watch.

Corn September Futures - 1 Year

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cattle

 August live cattle has traded to their highest level since June 7th.

I'm not sure if cattle will push through the contract (and all-time) highs given the lower trend in cash cattle.

However, right now the trend is still your friend and the trend is clearly higher.

U.S. beef supply is down significantly from last year, but the rally earlier this month may have priced that in.

I've been discussing with cattle operations how to use put options to protect these prices.

A lot of operations I talk to have not used their provincial insurance program this year.

Feeder Cattle September Futures - 1 Year

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Live Cattle August Futures - 1 Year