Canada Markets

Today's trade in corn, soybeans and wheat resulted in weakness that saw prices plunge through support of contract lows. December corn lost 11 3/4 cents or 3.2%, breaking out of a sideways trading range that has been in place for more than six weeks. December Chicago wheat fell 19 1/4 cents or 3.5% today, after trading over a sideways trading range for over seven weeks. November soybeans fell 12 cents to 1.2% to move below last week's contract low.

The canola market also lost ground today, with the November ending $6.10/mt lower at $418.40/mt. Unlike the other grains and oilseed trade, the canola market saw trade remain within yesterday's trading range, failing to test yesterday's $415.50/mt low as well as last week's $414.50 low.

Does this mean that the market has found its bottom? Harvest delays on the Prairies, due to rainfall across the southern regions of all three provinces, as well as today's DTN Market Weather Outlook where the possibility of frost is included in next week's forecast, may result in a floor for canola prices. Commercial traders were seen as supportive buyers this session, with the Nov/Jan spread narrowing $.40 to minus $5.80/mt, as seen in the move higher in the lower study of the attached chart.

DTN's five-year price probability chart indicates last week's close at $419.80/mt to be roughly in the lower 16% of the range of prices traded over the past five years, which may also act as a supportive factor in current trade. Many bin doors are closed as net returns to producers fall below $10/bushel ($440/mt) which may act to limit a further move lower in futures trade.

Should support at the contract low of $414.50/mt be breached, the next nearest level of support may be found at $409/mt, the lower end of a gap found on the weekly continuous chart formed in late February/early March.

Cliff Jamieson can be reached at cliff.jamieson@dtn.com

Follow Cliff Jamieson on Twitter @CliffJamieson

(CZ)

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