Canola

[farmaholic]

Canola up for now. Let's see what this week brings. Spring harvest slow and what quality. Still nearby inverse til Jan18.

New week predictions?

Is what's left in tightly locked bins? $igns of demand. Call for immediate delivery, narrowing basis, rising futures.

Where's your target price? Signed up under open ended contract? Or a uncommitted "moving" target?

[Partners]

Goofy stuff..nearby prices have premium..yet Viterra is 1 month behind on deliverys..
Trains are hit and miss.no delivery this week..then train drops off cars on Friday with no warning..what a great system.

[farmaholic]

In some cases maybe they want to buy now, or pay more later, and make empty promises of specific delivery periods. Nothing like being bought and not taking delivery....no one want to be short when it's needed. A cushion to fall back on. A prudent reserve to draw on if need be. Also, do you think GrainCos are always 100% hedged, buy on speculation?

[farming101]

On average the spring clean up of canola is not going well. If buyers were hoping for some of it to make the grade those hopes haven't been realized yet to any great degree.

Next chart target for me is 531 July. Could be a pause/pullback in that area. Should mean $12 in a few areas.
December 6/16 high of 545.20N is the target which should bring out widespread $12 bids.
If prices continue to rise this week I would not be surprised to see basis widen. It's the buyers way of sharing the increase in price with you
Rally damage is down at 506N but this level will rise as the week progresses.

Some has basis locked in and must go. A fraction of the rest will likely be sold around 11.75 delivered if that appears (price order?)as we whittle it down to gambling stocks

[farmaholic]

I have a gambling problem! Gamblers Anonymous wants to use me as their poster boy.

101(don't take this personally, your opinion is valued by me)...what drives me ****ing nuts are the numbers you quote based on "chart analysis". Seems to neglect the fundamentals.(?) Why should chart based trading trump fundamentals? Or are they actually more related than I think? Did you have puts that paid during the last down turn in futures prices. You talked about a basis contract.....I hate making commitments to one Co when I have more than one viable option on my doorstep. I firmly believe they don't have to effectively use the futures or spot bid aggressively if they have a pile of grain they know damn well has to come up the driveway by a certain date!

I'm all ears.....

[farming101]

Chart based pricing is important because that is what speculators watch. Not the whole market for sure but significant.
July puts were flying high for a while but are kaput now. Did not participate. Looking back should have.
Mostly do ddc or price orders well above market. Basis or futures only has a place in the toolbox at certain times.
As far as a dislike for being committed to delivering to one buyer, well maybe if a guy gets that feeling he should keep looking. We send the odd load here and there to test out other buyers but keep the crush plant on speed dial. They have been great ever since they opened.

[farmaholic]

Here's a neat thought, when's the last time canola traded at it's daily $30/t maximum?

For shits and giggles let's say it maxed out for 5 days straight (probably a better chance of winning Lotto Max)

Two days at $30/t
Two days at $45/t
One day at $60/t

$210/t or $4.76/bu.....more than wishful thinking, delusional thinking!

What would it take to get it to move the maximum at least one day? At the current prices I have a hard time believing it would move that much in one day...over several days? Easily do-able.

Interesting times.

The crush plants are a little far to be a viable delivery (by Tridem) option for us. Good for those within reasonable distance to them.

[farming101]

2013 bumper crop dropped the price 230/tonne over a nine month period
Small carryovers of 2011 and 2012 raised the price 185 over 9 months

Price advances usually have an organized character to them; price retreats are often chaotic

2016-17 carryover is forecast to be sufficient
World edible oil stocks are forecast to drop a little but that is countered by larger oilseed carryouts. This could mean crushers are not worried about supplies and are willing to stay current rather than stockpile

Cargill has traveled a long way out to pick up specialty canola. I would guess $11 picked up in the yard for southern areas right now for regular canola. I know, not in the ball park

Also, up till last Thursday anyway I would describe this rally as a short covering rally

[swinkler]

Hit $11.88 this morning, immediate delivery, here at one local terminal, zero basis. Think they have a train coming that needs filled. July target hit at $11.75 before I could pull it this morning. It's going to $12 IMO.

[lnjr]

Was $12 for may and June del at Adm Lloydminster this morning