Our online grain markets columnist Brian Wittal 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.
March 5 — We’re back on the roller coaster: up yesterday, down today, who knows tomorrow? Financial markets gave back all and more of yesterday’s gains on news that the ailing auto sector is in serious shape and some of the Big Three may not survive. The Dow Jones is down to 11-year lows.
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Non-commercial speculative traders were re-entering the grains today, with hopes that maybe we have seen a bottom, and they are in the mood to gamble. This is something we have not seen for a while so hopefully this is a good sign for grains overall.
The U.S. Department of Agriculture’s weekly export numbers came out today. Corn exports were above market expectations, while beans and wheat were below expectations. Beans were lower primarily because China is now buying cheaper South American new-harvest beans and wheat exports are down due to the rising U.S. dollar making U.S. wheat more expensive.
Crude oil was down $1.77 to close at US$43.61 per barrel.
The U.S. dollar was up half a cent, which hurt the U.S. grain markets. The Canadian dollar fell one cent, closing at US77.52 cents, which allowed canola to end the day on the upside.
Corn was down five to seven cents a bushel, beans were down 10 to 17 cents a bushel and wheat was down six to eight cents a bushel.
Canola was up $4 to down $1 per tonne, and barley finished unchanged for the day.
Canola managed to be the only grain that ended on the upside today due to speculation that China was buying because of the lower Canadian dollar.
The continued financial woes and the higher U.S. dollar dragged the U.S. grain complex down today, and that certainly put a damper on canola, as only the nearby months were able to hold onto slight gains for the day, with forward months falling slightly.
Tight supplies in the country due to farmers’ stubbornness not to sell right now has companies offering premiums to secure stocks.
The futures are going to continue to struggle as they compete with U.S. and now freshly-harvested South American beans, so if you can extract a premium from the grain companies while they are tight on supplies, it may be worth considering.
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.
