Jan 16 Canola broke down through 480...

[crusher]

Have any of you looked at soy oil futures? Pretty much tells the story. Drought in Alberta followed by a bail out rain means squat compared to the direction of soy oil.

[errolanderson]

crusher . . . this soyoil fallout was the result of China's currency devaluation. Impacted all global veg oil markets.

[TOM4CWB]

Crusher,

Very true about Soy Oil.

Checked long term chart... Soy oil is now half of 2012 prices... just like crude oil... the two now are related... as is the value of the US$. As the US$ increases in value... Black oil and Soy oil decrease.

I do wonder if like with yellow peas... there is many orders on the books... so the basis is most likely to be very sweet... and the futures continue to follow the trend down.

truly wonder when the US$ stops its assent... if it falls... the decline will be a very wild ride... like the 'drop of doom' ??? When do currency wars shake this up? Or does devaluing Yuan keep lifting US$?

When does CDN$ fall hard... if ND take over in Ottawa... wouldn't negative interest rates and 50 cent CDN$ be the first order of business???

[TOM4CWB]

Broke through $470... Ouch... to $463?

[MBgrower]

What if usa bean production surpasses 4 billion bu? Could we see canola break 420? 9 dollar canola targets could become popular this winter.

[TOM4CWB]

China needs to get back on track... the financials are more concerning each day... buying $b of stocks on China exchange. Now a list of stocks not to buy because the gov intervention agencies own $b of them. Over $600B USD bought by last week... headed to 1T$ USD interventions propping up exchange in China. Smart money getting out... the gov buying the stocks that are way overvalued.

Talk of reducing China support of domestic corn... draw down local stocks in China...

[crusher]

We need a frost scare.

[errolanderson]

November canola $470 put options are trading for $14/MT today.

This offers a $456/MT ($10.34/bu) floor plus or minus your fall delivered basis.

Fallout in global veg oil markets continuing . . . .

[TOM4CWB]

Errol,

Just did a Sold490 Call Bought460 Put spread... at even money. In my mind this makes better sense as an options risk cover plan.

Too much volatility cost in buying the Put outright!

Tired of paying options premiums!!!

[errolanderson]

Tom, solid trading strategy, but you are responsible for the upside beyond $490/MT. But if you have the crop, it's a hedge. Thanks for the input . . .