Sept. 25 –– Outside markets continued to slide heading into the weekend as trade was limited. Some may be waiting to see what, if anything, comes out of the G-20 meetings in Pittsburgh that may help direct markets going forward. Energy stocks were mixed, with crude down slightly and natural gas up slightly on the day.
Currencies continued to bounce around but with less volatility than what we have seen the past few days. The U.S. dollar closed down just over a 10th of a cent today, down a third of a cent from last week’s close.
The December Canadian dollar closed down 0.28 cents today at US91.56 cents, down 1.93 cents from last weeks close.
The Dow Jones December quote finished down 27 points, closing at 9,608 today, down 125 points from last week.
Crude oil closed up 13 cents a barrel at US$66.02, down $6.47 from last week’s close.
Corn closed down two to 3.2 cents a bushel today, up 16 cents a bushel for the week. Beans closed up three to 6.4 cents a bushel today, down 25 cents for the week.
Wheat futures closed down hard, with losses of 10-23.2 cents a bushel.
Minneapolis December wheat closed down 13.4 cents a bushel for the day, down 10 cents a bushel for the week.
Canola closed mixed, up 20-70 cents a tonne on nearby futures to down $2.70 per tonne on forward months. The November futures are down $3.60 a tonne from last week’s close.
October Western barley dropped $11 per tonne, closing at $104.50, down $16 for the week. November futures closed up 80 cents at $148 per tonne. The big drop in the October barley was due mainly to traders rolling their positions from October to November forward.
Statistics Canada will be coming out with a production estimate report next Friday morning and it is certain that canola production will be increased in the report, but will it truly reflect the larger-than-expected crop that’s really out there?
The Canadian Wheat Board released its September pool return outlooks (PROs) yesterday afternoon and, as was feared, values have dropped a little further due to increased world production.
What’s also fairly evident is that there’s a premium for protein starting to be built into the markets, as the PRO value for a No. 1 CWRS, 14.5 per cent, went up $3 per tonne, while the PRO for a No. 1 CWRS, 11.5 per cent, fell $7 per tonne.
This tells me that if you have “lo-pro” or lower-grade wheat, you will want to try to deliver as much of it as you can to take advantage of the price spreads that are locked in with the current initial prices, before the CWB adjusts the initial prices and widens the spread. Traditionally the first initial price adjustment the CWB does is in December/January.
Durum PROs were down $25 per tonne; large supplies of durum in North America are the main reason.
Malting barley PRO values are down $12 per tonne as a large, high-quality European crop and favorable harvest conditions in North America continue to build world stocks, pushing world values lower.
That’s all for this week. — 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.