Advertise in Print | Subscriptions
Published June 09, 2014, 09:35 AM

Seeding advancing

WINNIPEG, Manitoba — Western Canada is 85 percent seeded with most areas done or close. Southeast and east-central Saskatchewan and western Manitoba remain wet. Perhaps 1.5 million to 2 million acres will not be seeded because of excess ground moisture.

By: John Duvenaud, Agweek

WINNIPEG, Manitoba — Western Canada is 85 percent seeded with most areas done or close. Southeast and east-central Saskatchewan and western Manitoba remain wet. Perhaps 1.5 million to 2 million acres will not be seeded because of excess ground moisture.

North Dakota durum planting advanced from 37 to 62 percent last week.

Some of those last fields will not get planted because of excess wetness.

Overall spring wheat in the U.S. is 88 percent planted, about normal.

American crops looking good

American corn is 95 percent planted, with soybeans at 78 percent, both mildly ahead of normal. Corn conditions are 76 percent good to excellent, well above average.

The crop is mostly in good moisture.

Canola poised for weakness

The canola market remains under pressure, as producer selling increases. Farmers have large supplies to liquidate in the next two months, which will cause basis levels to deteriorate and temper any strength in the futures.

The upcoming crop continues to develop under favorable conditions and moderate temperatures are forecast for the next month. Traders anticipate trend yields, which will cause supplies in September and October to overwhelm the commercial system.

Outside influences are setting a negative tone for the oilseed complex.

Soybean spot prices are sideways, while new crop is trending lower.

Chinese soybean crush margins remain in negative territory stemming from import demand. This has caused a backlog in Brazilian exports. The world soybean market needs to encourage demand through lower prices.

World vegetable oil prices are in a downward trend now that new-crop Argentine soy oil is coming on the market. It is hard to find any factor that could be supportive for canola prices in the next couple months.

Speculative funds have potential to be aggressive sellers in beans and canola, which will enhance weakness in canola. The canola market needs to move lower to entice offshore business for late summer and early fall.

Feed barley under pressure

Feed barley prices peaked at $220 per metric ton delivered at Lethbridge earlier in May, but the market is now trading at $210 per metric ton. Seeding is wrapping up across Western Canada and the market has to absorb the surge in farmer selling. Fertilizer season is in the final stages and trucks are now available for grain movement. We forecast a carryout near 2 million metric tons. Large supplies continue to weigh on the market. Cattle-on-feed inventories drop by 30 percent from May 1 to July 31, so the domestic demand is declining.

The nondurum wheat carryout will be 11 million metric tons, up from the average of 5 million metric tons. Expect farmers to sell a larger amount of low-mid protein milling wheat into feed channels in the next couple months to make space for new crop production.

World barley prices are absorbing new crop Ukraine and Russian exportable surplus. Barley is offered at $250 per metric ton freight on board the Black Sea for August and September. This compares with Canadian barley at $290 per metric ton freight on board in the West Coast. We are not going to see fresh export business from Canada because of the large price discrepancy versus the other exporters.

U.S. corn conditions are favorable. Trend yields will result in burdensome supplies during harvest.

Editor's note: Duvenaud is the publisher of the Wild Oats Grain Market Advisory. For a sample issue, call 1-800-567-5671 in Western Canada and North Dakota, 204-942-1459 for all others, or e-mail admin@canadagrain.com or visit canadagrain.com.

Tags: