Aug. 28 — Outside markets tried to show some strength early on, but then profit-taking started to kick in and quickly stalled out that early momentum.
Financial markets followed the same pattern today, with a positive opening that soon fizzled out to end the day mixed to down for the most part.
The U.S. dollar is up just over a third of a cent today. The Canadian dollar is down 0.46 cents at US91.5 cents, down eight-10ths of a cent from last week.
Read Also
Strong demand for generics prompts FBN expansion
Farmers Business Network is responding to strong demand for generic agricultural chemicals by expanding its Canadian operations.
The Dow Jones September quote is down 48 points at 9,519, up 200 points over last week.
Crude oil is up 25 cents a barrel at US$72.74, and down $1.15 a barrel from last week’s close.
Corn closed mixed, up two to down two cents a bushel today and unchanged from last week’s close.
Beans closed up 13-22 cents a bushel today and up $1.12 over last week’s close.
Wheat futures closed down from seven to 17.2 cents a bushel on the various U.S. exchanges. Minneapolis September wheat closed down 17.2 cents a bushel today and down 11 cents from last week.
Canola closed down $1-$3.10 per tonne today. November futures are up $6 per tonne over last week.
October Western barley dropped $9.60 per tonne, closing at $109.40. November futures are down $4.20 at $145.60 per tonne and down $16.40 per tonne from last week’s close.
Pools pressured
The Canadian Wheat Board’s pool return outlooks (PROs) were hit hard in the latest adjustment released yesterday, as world markets continue to signal adequate stocks worldwide and good growing conditions overall.
Wheat PROs were dropped between $19 and $28 per tonne depending on class and grade. Durum PROs were dropped $27 to $31, depending on grade.
Feed barley PROs were dropped $4 per tonne and malting barley PROs were down $18-$20.
Current U.S. production estimates continue to grow as harvest nears due to almost ideal weather. This will keep prices floating at these levels for the balance of the crop year unless we see some major harvest issues arise over the next couple of months that either eliminate production or reduce quality.
A quality wreck may be the only real way that world prices may move back up to any great extent. If the North American wheat harvest gets rolling and is done in short order with few problems, you can expect prices to stay flat to down for the remainder of the crop year.
Planning your cash flow for the coming year is going to be an interesting task. Ample supplies of wheat worldwide could mean sitting on stocks in your bins for quite some time, depending on your quality. Using other grains to supplement cash flow is going to become critical, which means planning sales now for forward months to ensure a consistent cash flow to meet bills and payments to avoid service and interest charges.
Take a moment to review new-crop sales to see what you have coming in for cash and when. If you need to make some changes or make more sales you are going to want to do them before you get full into harvest, or things may get left undone.
That’s all for this week. — Brian
— Brian Wittal has spent over 27 years in the grain industry, including as an elevator manager and producer services representative for Alberta Wheat Pool, a regional sales manager for AgPro Grain and farm business representative for the Canadian Wheat Board, where he helped design some of the new pricing programs. He also operates his own company providing marketing and risk management advice for Prairie grain producers. Brian’s daily commentaries focus on how domestic and world market conditions affect you directly as grain producers.
Brian welcomes feedback and information on market conditions in your area, such as current offering prices, basis levels, trucking premiums and special crops contracts. Contact Brian today.
