Wittal: Review strategies in light of USDA data

Jan. 13 — Outside markets showed some rebound today with gold and financial indicators up slightly. Crude oil was down again today and grains were mixed, with corn down and wheat and beans up modestly.

The U.S. dollar index fell 11-100ths of a cent today, while gold closed up $7.50 at $1,136.40. The Canadian dollar rose 0.68 cents to close at US97.04 cents.

The Dow Jones March contract closed up 78 points at 10,633 today. In the energy sector, crude oil closed down $1.14 at US$79.65 a barrel.

Corn closed mixed, down 8.4 to up three cents a bushel today. Beans closed up 9.4 to 14.4 cents a bushel.

Wheat markets closed up 1.2-7.2 cents a bushel today; Minneapolis March futures closed up 3.2 cents a bushel.

Canola closed up $2.60-$4.20 per tonne today.

Western barley closed unchanged at $156.20 per tonne. 

The trade took a step back and a big breath after yesterday’s hard sell-off to try to get a feel for what really happened yesterday. As a result, there was some renewed buying back in the bean markets that helped to push futures back up, regaining almost half of what they lost the previous day.

Canola followed along, but a rising Canadian dollar stalled the momentum and ended the day with only small gains in comparison to beans.

The numbers that came out of the U.S. Department of Agriculture’s reports yesterday should change the way you view the markets and make you re-evaluate your marketing strategies going forward for old crop and new crop.

Re-establishing pricing targets at more realistic levels that will still give you a net profit, and moving the grain sooner than later, are things you need to consider as there is now a lot more grain out there and it will be competing against you.

So you need to ask yourself: Is it worth holding onto grain, or are you better to sell now and be done with it before others start selling theirs?

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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