Periodic Updates on the Futures Markets

March canola is up $9.30 per metric ton (mt), March soybean oil is down 0.42 cents per pound, February European rapeseed is down 7.25 euros per mt and February Malaysian Palm Oil is down 1.40%. March oats are up 1/4 cents per bushel. February crude oil is down $.04 per barrel and the March Canadian dollar is up 0.00165 at 0.69900. The U.S. dollar index is down .687 at 107.465 and the Brazilian real is up .00070 at 0.16415.

Markets are going from risk-off to start the day to a “buy everything” type of day. A cooler than expected inflation report out this morning allowed interest rates to pull back, taking the US dollar with them. That allowed a sharp rally to develop in equities, spilling over into sizable gains in meat and metal markets with energies even making a comeback.

Canola is strong as Thursday’s key reversal higher may have scared the shorts. Soybean meal is sharply higher as it appears money managers are taking profits from their near record short positions. That has helped with a good rally in soybeans while soybean oil is being hurt by unwinding of the long oil — short meal spread. For canola, the fact that the January contract is leading the way higher, now only $3.60/mt below the March, suggests shorts trying to liquidate their positions ahead of first notice day may be a factor. With the continued strong exports confirmed by the CGC, a psychological shift may be taking place as the risks of remaining short start to outweigh the rewards.