CNS Canada — Manitoba producers who grew soybeans this past summer are having a hard time moving them off their farms because of the backlogged Prairie grain handling system.
Normally, soybeans are one of the easiest crops to move because Manitoba is a “small drop in the bucket” compared to the U.S. when it comes to production and can usually just “get thrown into that big bucket,” said Shawn Rempel, product manager with Quarry Seed at Stonewall, Man.
But that’s not the case this year because of the competition from many other crops also trying to move out of Western Canada through the railway system.
“We’ve noticed a lot of Manitoba growers struggling to deliver soybeans,” he said. “It’s not so much that the price isn’t decently attractive; there’s nowhere to put it.”
There’s no room at local elevators to store soybeans because they’re already full with other grains, and it’s taking longer to make space because of slow rail movement out of Western Canada.
And there aren’t many other options to sell because some elevators in the U.S. are also not accepting Canadian soybean shipments.
“I know some of the U.S. elevators have basically put a hold on our movement,” Rempel said. “We haven’t moved any soybeans down south in a couple of months.”
Some farmers are also making the decision to keep soybeans on their farms because they store better than some other grains such as canola and wheat.
“Guys will sit on it if they have to,” said Rempel. “It’s a commodity that’s still worth something if you can get it moved. So, farmers with fall contracts are still looking to get it moved sometime into the new (crop) year.”
Prices for soybeans are still attractive enough to keep growers interested in planting the crop this spring, but they’re not as high as the futures on the Chicago Board of Trade.
“It’s just simply a function of there’s not really much room to store these soybeans at the elevators, so you’re starting to see some basis levels and whatnot kind of show that,” Rempel added.
Soybean area expansion is expected to continue within Manitoba, as well as into Saskatchewan this spring.
“There’s a big chunk of Manitoba where a lot of guys have been pushing rotations. Whereas in western Manitoba, and northern Manitoba, there’s a lot of room for heavier soybean rotations,” said Rempel. “And that’s where we’re seeing a lot of our sales growth, and even in Saskatchewan our sales have never been stronger.”
Soybeans are a profitable crop for Manitoba producers to grow because of the minimal input costs. Very little to no fertilizer is needed for soybeans, though a late spring could deter some new interest.
But with longer-season varieties becoming more and more available, some farmers in Manitoba will make sure they get their soybeans planted this spring.
“There was a time where canola was that go-to crop if things looked late,” Rempel said. “But with the input cost being as high as it is on canola or wheat for the minimal returns, I think you’re going to see a lot of guys kind of holding off on planting other crops.”
“They’re going to want to get their soybeans in because they know it’s a crop that pencils in.”
— Terryn Shiells writes for Commodity News Service Canada, a Winnipeg company specializing in grain and commodity market reporting.