Canola market - up -down?

[furrowtickler]

Canola was up big early today but now turning down whats the deal? These markets are realy fickle right now. Anyone see a run to $500/tn before dec or will it take until feb/march if at all?

[agstar77]

BNN cited reduced consumption for the drop in ag products. I guess the world is going on a diet. they also stated there is a large crop this year. Wern't these the same people who were worried about starvation. Maybe if we all reduced or limited inputs such as fertilizer it woud sharpen their minds.

[Zaphod]

We had already reduced consumption when the markets were at their highs. BNN is out to lunch. The peaks of the markets were driven by the funds and so are these lows. The fundamentals are somewhere in between and they won't start having an influence until the index funds are flushed out. The index funds are still long 280,000 corn contracts (35 million tonnes). As long as people keep redeeming their commodity fund holdings, markets will keep going down.

[agstar77]

In other words capitulation has not hit the Ag commodities yet!

[Zaphod]

If you want to have more fun, add up the funds' position for corn, beans and wheat. It equals 2.87 billion bushels. That's 1,373 Panamax vessels (55,000 tonnes each) or 2,517 grain elevators (30,000 tonnes each)

Each time the market loses a penny, the funds lose $28.7 million. If the markets go limit down, it's a loss of $1.35 billion. That's right, billion. The scary thing is that, depending when they bought, they can still be money ahead.