Wittal: Farmers hang onto old-crop stocks

June 11 — The U.S. financial markets have found some renewed interest today. The U.S. dollar was down, the Canadian dollar was up almost a full cent and crude oil was also up.

The Dow Jones June quote closed up 56 points today at 8,810, while the Canadian dollar closed up 0.98 cents at US91.11 cents.

Crude oil finished up $1.35, closing at US$72.68 per barrel.

Corn finished up five to six cents per bushel today, while beans finished up eight to 21 cents per bushel. Wheat finished up eight to down four cents per bushel on the various U.S. exchanges today; Minneapolis July wheat futures ended up 7.4 cents per bushel.

Canola finished up $1-$7 per tonne for the day. Barley finished down $2.90 per tonne, to close at $164.10 per tonne.

Weekly U.S. export numbers show a continued slowdown in wheat purchases, which is starting to get the trade’s attention and will no doubt impact pricing going forward, given the current world inventories as reported in the U.S. Department of Agriculture’s report yesterday.

Exports of corn and beans were also down from previous weeks and from target levels set for the year, but the trade seemed to ignore those numbers and pushed futures higher on continued crop condition and growing concerns in the U.S. and around the world.

Canola values showed some strength today with the help of crude rising even in the face of the Canadian dollar rising almost a full cent.

Producer deliveries seem to be drying up as producers are concerned about the condition of the current crop in the ground, so they are holding onto stocks until they feel more comfortable. This could put the trade in a bind to source stocks to meet sales, which would tell me they are going to have to incent producers even more to get them to deliver.

Before selling anything, make some calls to check out what other companies are offering, as basis levels and prices vary greatly.

That’s all for today. — 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.

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