(Resource News International) — Cash bids in Western Canada for oats have been trending upward, albeit at a very slow pace. Continued large carry-in supplies of oats have been preventing values from climbing faster.
“There is still a lot of oats from the previous year’s harvest that we are dealing with and to tell you the truth, there are a lot more usable supplies of oats from this year’s harvest than had been anticipated,” said Terry Tyson, a grain buyer for Grain Millers Canada at Yorkton, Sask.
Tyson said there were ideas that a lot of the oats that had been lying in swath and were unable to be harvested would have graded extremely low.
“But we are finding that in a lot of the samples being submitted by producers who had oats lying in swath for quite some time this fall, the product is still very millable,” he said.
However, he also acknowledged producers have been reluctant to let go of their oat supply, which has helped to firm up cash bids to some degree.
“The producers have levels at which they will deliver certain quantities of their oats,” Tyson said, noting that when bids hit $2.25 a bushel, producers began to move some of that product.
The taps have since been shut down, Tyson said, noting that producers were probably now waiting for oats to hit the next price plateau of around $2.50 a bushel before becoming willing to let go of more oats.
Some buyers were still looking for deliveries in December, but those windows of opportunity were probably very limited at best, he said.
“A lot of the individuals who want oats have coverage through January and into February already,” Tyson said.
“I think as supplies begin to tighten up, the cash price for oats will also continue to firm, but we will need to work through some of the previous year’s supplies first.”
Cash bids for oats delivered to the elevator in Saskatchewan, based on Prairie Ag Hotwire data, currently range from $1.89 to $2.04 a bushel, in Manitoba from $1.97 to $2.30 and in Alberta from $1.72 to $2.33.
At the end of September, oats delivered to the elevator in Saskatchewan ranged from $1.54 to $2.10 a bushel, in Manitoba from $1.99 to $2.10 and in Alberta from $1.36 to $2.18.