TODAY IN HISTORY Jan 14
In 1671... Snow falls for the first time in what will be the shortest winter in Quebec’s history. With all snow gone in March, many who had depended on cold weather to preserve stores of food end up starving.
In 1878... Alexander Graham Bell demonstrates the telephone to Queen Victoria, who uses it to speak to a friend.
In 1949... The first non-stop flight across Canada, a Douglas DC-4M, goes from Vancouver to Halifax.
In 1976... The T. Eaton Company announces the end of its catalogue sales operation, which had been in existence since 1884.
CLOSING MARKET REVIEW
ICE canola futures finished the day weaker, pulled down by weak demand for the crop. Settlement prices are in Canadian dollars per metric tonne.
Chicago soybean, oil and meal contracts were all down as well. New customs data released from China this morning showed December soybean imports dropped 40.1 per cent from last year. However, soybean imports in November from the United States had plunged to zero, due to the US-China trade war.
There is concern about waning end user demand for canola, coupled with weak farmer deliveries. With farm shows in Saskatoon and Brandon over the next few weeks, deliveries will continue to be down.
Rain fell across southern Brazil over the weekend. The forecast is calling for more rain there this week, while the central and northern part of the country is expected to remain dry. There have been concerns about dryness in Brazil affecting the soybean crop there.
About 9,671 canola contracts traded, which compares with Friday when 11,229 contracts changed hands.
Chicago soybean futures finished the day down 6 cents/bu, near the lows of the session and falling to the lowest level since Jan. 2. Mar bean futures fell back below its 20- and 50-day moving averages. Failure to mount a stronger challenge of the December highs last week despite progress during three days of US-China trade talks continues to weigh on prices.
The latest trade data from China showed worse-than-expected numbers. China's exports unexpectedly fell the most in two years in December, while imports also contracted, pointing to further weakness in the world's second-largest economy in 2019 and deteriorating global demand. Of course the US trade imbalance with China, despite Trump’s trade war, has never been higher.
Worries continue that China has completed all if its US soybean buying until after a trade deal is completed or China agrees to cut its 25% import tariff. China will be sending its Vice Premier Liu He to the US during the closing days of January.
Soymeal led the soy complex down today after Chinese meal futures fell to three-year lows after the government confirmed three more outbreaks of African swine fever during the weekend, including two at breeding stock farms with a total of 68,969 hogs, according to Bloomberg News. ASF has now spread to all 23 of the country’s provinces, increasing fears of reduced feed demand in 2019.
Weekly US soybean export inspections were up sharply from the previous week at 1.085 MMT, which was stronger than expected.
Chicago corn futures ended fractionally higher. The nearby March contract rose back above its 20- and 50--day moving averages this morning, setting off light new buying and short-covering activities. But the contract slipped back just below those marks at the close. The key technical point though remains closing above strong resistance at the December high of $3.88/bu.
Some buying support continues to develop on price weakness after China’s pledge to purchase “substantial” amounts of ag, energy and manufactured goods during last week’s trade talks. Reportedly the US also asked China to resume imports of ethanol and dried distiller’s grains at levels similar to those prior to trade tensions.
US Gulf basis bids improved on Friday, but interior basis remains relatively weak.
The price floor on corn is rising amid dryness in Brazil during December and January. Some showers this week will ease stress, but forecasters are divided about next week’s outlook and the more important period from March to April for the second-season crop, which is the one Brazil exports.
Weekly US corn export inspections were stronger than anticipated at nearly 1.014 MMT.
Winter wheat futures are 4 to 6 cents lower. Spring wheat futures closed 3 to 4 cents down. With domestic Russian wheat prices on the rise, the market is on alert for a possible new meeting between the ag ministry and exporters on possible limits on shipments before the new-crop in June. A regular meeting is scheduled in February.
Increasing wheat import tenders from various buyers suggests users are looking to extend coverage as world prices continue to rise from their October lows.
Weekly US wheat export inspections were stronger than expected at 545,804 MT.