Wittal: Aggressive canola basis on offer

Our daily online grain marketing 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.

Feb. 25 — Financial markets started off in a down mood today and tried to turn it around as the day went on, but were not able to break into positive territory and ended up with small losses for the day.

The U.S. dollar gained almost one cent today, which added pressure to the markets.

Crude oil jumped $2.54 per bushel to close at US$42.50.

The Canadian dollar was down just over half a cent to close at US79.88 cents.

Corn was up nine to 10 cents a bushel; beans were down one to four cents a bushel; wheat was up three to 13 cents a bushel.

Canola was up $4 to $10 per tonne, and barley finished even to down $1.50 per tonne for the day.

Reports that China has cancelled shipments of beans from the U.S. had bean futures trading down hard to start the morning, but they were able to pull back up from those lows to end up with only minor losses for the day.

Canola showed some strength, with a falling Canadian dollar making canola more competitive.

On-again, off-again farmer strikes in Argentina are catching the markets’ attention as concerns build that this could again turn into a long, drawn-out situation that would virtually shut down export shipments of grains from that country. This is having an impact on its reputation as a reliable supplier that may force buyers to look elsewhere for a more reliable source for their grain needs.

This cold weather snap may deter farmers from delivering grains, which may add some additional fuel to the markets on a very short-term basis.

The U.S. Department of Agriculture came out with its initial spring seeded acreage numbers for 2009. They project corn plantings in 2009 will rise 2.3 per cent to 88 million acres and soy plantings would drop about 2.2 per cent to 74 million acres while wheat seedings would decline 4.1 per cent to 60.5 million acres. The estimate was based on conditions between October and December.

Analysts, however, disagree with these numbers, believing producers are going to do the opposite, which is decrease corn acres and increase bean acres.

Everyone has an opinion!

Aggressive canola basis for immediate and future delivery is being offered again. Viterra at Crossfield, Alta., about 40 km north of Calgary, is offering +$14.91 per tonne for April/May delivery and -$11.74/t for November delivery.

In Saskatchewan they are offering a +$1.89 per tonne basis for April/May, delivered to Kindersley.

In Manitoba they are offering a -$4.99 basis for April/May deliveries to Brandon.

Please check with your local delivery station for exact quotes as they can and will change without notice.

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 a grain producer.

About the author

,

Columnist

Brian Wittal

Brian Wittal has 30 years of grain industry experience and currently offers market planning and marketing advice to farmers through his company Pro Com Marketing Ltd.

Comments

explore

Stories from our other publications