Aug. 20 –– Markets were rather quiet today with very little trade happening. Financial markets are up ever so slightly on very thin trading volumes as well.
Grains struggled along again today, with no real direction or news to prompt any real trading action. Weekly export sales numbers for corn were above expectations and beans were at expected levels.
Wheat numbers were about half of what is needed to hit the U.S. Department of Agriculture’s sales targets for the coming year, which is causing concern when expectations for a better-than-average crop are still being predicted this fall.
Crop tours throughout the U.S. are finding crops as late as three weeks behind in maturity and yields quite variable from state to state. Overall, though, yields still look to be at or above average for corn, beans and wheat for this fall.
The US dollar is down almost one 10th of a cent today. The Canadian dollar is up 0.64 cents to close at US91.86 cents.
The Dow Jones September quote closed up 44 points at 9,320.
Crude oil ended mixed, with the nearby month up 12 cents a barrel today to close at US$72.54. Forward months are down 90 cents to $1.20 per barrel.
Corn finished down one to 4.2 cents per bushel today while beans ended mixed, up two to down seven cents a bushel today.
Wheat was even to up five cents a bushel on the various U.S. exchanges. Minneapolis September wheat futures closed up 20 cents a bushel today.
Canola finished down 30-50 cents per tonne today, while barley closed up 30 cents at $134.80 per tonne.
Pressures on feed grains
With the current situation in the feed grains markets not looking real good (price-wise, that is, for sellers) due to the potential of frost on late-maturing crops possibly giving up excess supplies of feed grains this winter, a strategy to use when looking to sell feed grains may be to look north, not south, this year.
The reason I say this is that because of the cheap distillers dried grains (DDGs) that are currently coming into Feedlot Alley in southern Alberta, and the potential for cheap U.S. corn to come in as well, prices for barley delivered to southern Alberta are going to be under extreme pressure.
I would expect prices for feed grains in more northerly areas of Western Canada (Edmonton, Saskatoon) should be at a value higher than at Lethbridge because of the additional costs to freight DDGs or corn further north, which means they should be offering higher values for barley or feed wheat than what you may be able to get at Lethbridge.
It may be worth taking the time to start calling feeders in more remote regions of the Prairies to see what they are going to be looking for and what they’re offering for feed grains for fall delivery — especially in areas that were very short on their hay crops this summer.
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.