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Wittal: Grains up on last-minute spec buying

Dec. 16 — Outside markets were definitely stronger today with gold and crude oil showing some solid gains. Financial markets were a little mixed today and currencies were down just slightly for the day.

Gold closed up $13.20 at $1,135.70 today. 

The U.S. dollar was trading down five-100ths of a cent today; the Canadian dollar closed down 0.09 cents at US94.09 cents today. 

The Dow Jones closed down eight points at 10,451 today.

In the energy sector, crude oil closed up $1.97 per barrel at US$72.66.

Corn closed up 2.6-4.4 cents a bushel today, while beans closed up 4.4-7.4 cents a bushel.

Wheat markets closed up one to seven cents a bushel today; the Minneapolis March futures closed up seven cents a bushel. 

Canola closed unchanged to up $1.20 per tonne today.

Western barley is unchanged today, closing at $159 per tonne.

Grain markets were mixed and rather quiet for most of the day. Speculative buying in the last five minutes of trade pushed beans and all grains into slightly positive territory today.

Canola futures were able to hold small gains on news that crush margins are doing well and farmer selling is very limited as the holidays near. Plus, the dollar fell slightly, which helped spur some crusher buying today.

If the speculative undertones can persist and keep grain prices at these levels into the new year that would certainly be seen as a positive heading into spring.

If the big speculative money continues to see commodities as a place to rest and/or invest for the time being, that will certainly help establish some decent floor levels for the grain markets going forward, until such time as a major event happens somewhere in the world of grain production to change their minds.

What would help to further stabilize prices would be renewed buying from other countries, which we will hopefully see start happening in the new year. If buying doesn’t pick up, then be prepared for more turbulence in the markets as the spec money will be looking for profit opportunities and will jump in and out on a whim or a rumour.

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.

Brian 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.

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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.

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