Wittal: Fundamentals pressure grain futures

Jan. 26 — Overall markets were rather quiet again today, which resulted in small losses across the board. The U.S. dollar ended slightly higher on the day, while crude oil and financial indicators were down slightly.

Grains were all lower on the day as technical selling became the focus. Fundamental pressures (world inventories) continued to push futures lower.

The Canadian dollar ended modestly lower, which helped keep canola in a more or less neutral position today. 

The U.S. dollar index rose 16-100ths of a cent today; gold closed up $2.70 at $1,097.90.

The Canadian dollar fell 0.28 cents to close at US94.32 cents today.

The Dow Jones March contract closed down two points at 10,138 today. 

In the energy sector crude oil closed down 55 cents at US$74.71 a barrel.

Corn closed down 3.4-5.4 cents a bushel today; beans closed up 3.6-7.6 cents a bushel.

Wheat markets closed down 1.2-4.2 cents a bushel today; Minneapolis March futures closed up two cents a bushel.

Canola closed down 30-60 cents per tonne today. Western barley closed unchanged at $150 per tonne.

Reports are showing fertilizer prices starting to increase, as demand for certain products is building. Phosphate fertilizer prices seem to be leading the way, and this will no doubt carry into other products as usage increases in South America, and then in North America, as spring approaches. You may want to look into securing inventories for spring sooner than later.

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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