Despite recent rains in drought stressed canola production areas of Canada, prices continued to be steady the final week of June, according to Barry Coleman, executive director of the Northern Canola Growers Association.
“Some in Canada say that was only a short-term reprieve, and there is still going to be issues with dryness in Canada, which continues to support the market,” Coleman said. “Another thing that continues to support the market is all the rain in the Midwest and the slow pace of crop progress.”
Chart wise, they said the upper trend line drawn off the early May lows on the canola futures is still intact, and the line is currently being tested at $465 a ton on the November contract, which could accelerate selling pressure. Overhead resistance resides at the $475 level.
The canola futures prices at the end of trading on June 24 had new crop November contracts at $465 and old crop July contracts were at $452, which was down slightly. Cash prices at the crushing plants ranged from $15.02 to $15.45 per hundredweight, with the top end prices showing a slight improvement over the last two-week period, Coleman said.
“Prices have been on a little bit of a rebound in the last month, which is good,” he noted.
Canada recently revised their export and carryover figures for canola for the end of the marketing year. They had been estimating a 5.3 million ton carryover, but have now made a huge revision and lowered that figure to 4.3 million tons and increased the anticipated export figure by a million tons to 9 million.
However, that figure is still lower than the 9.3 million tons exported in this current year and the 10.7 million tons exported last year.
“If they do end up with 4.3 million tons of ending stocks, that is still going to be larger than last year’s end figure, but not nearly as bad as things had looked two months ago,” he said.
The weekly crop report from the National Ag Statistics Service indicated a significant decline in the canola crop conditions in North Dakota, with the percentile of crop in the good-to-excellent category slipping from 69 percent last week to 51 percent this week, which means the majority of the crop has now moved to the fair-to-good category. Coleman has not been given a reason why the crop conditions deteriorated in a week’s time, but also indicated past experience has shown crop condition ratings don’t correlate very strongly with what we end up with yields at the end of the year.
Finally, we are entering the season of field days at the various Research Extension Centers across the state. The latest in canola research will be a part of the program at both the North Central REC in Minot and the Langdon REC in Langdon, since they are located in prime canola production areas in the state.
The field day at Minot is scheduled for July 17, while the Langdon field day the next day on July 18.
“We will be talking in depth about clubroot and the research we are funding to get a handle on it, not only in the northeastern part of the state, but all through the north central corridor of the state,” he said. “We are trying to map levels of clubroot we are finding in the soils and things growers can do to keep that disease from becoming an issue.”