Wittal: U.S. bean buying may support oilseeds

REVISED, June 5 — The U.S. dollar jumped up strong on better-than-expected employment figures released today. Financial and energy markets held steady to finish the week.

The Canadian dollar closed 1.76 cents lower at US89.41 cents today — down two cents for the week. The Dow Jones June quote closed up 39 points today, at 8,769.

Crude oil finished up $2.69, closing at US$68.81 per barrel.

Corn finished down three to five cents per bushel today, up eight cents per bushel for the week. Beans finished down four to 22 cents per bushel today, up 41 cents per bushel for the week.

Wheat finished down nine to 17 cents per bushel on the various U.S. exchanges today. Minneapolis July wheat futures ended down 18 cents per bushel today, down 29 cents per bushel for the week.

Canola finished even to down $3 per tonne for the day, up $19 per tonne for the week. Barley finished up 80 cents per tonne to close at $168 per tonne, up $14.40 per tonne for the week.

Better-than-expected U.S. employment numbers helped to buoy the U.S. dollar and financial markets. The stronger dollar did pressure grain values as exports will be impacted by the higher dollar.

Weekend weather will be the focus of the markets and will respond accordingly Monday when markets open.

World wheat fundamentals started to put pressure on markets, then the funds got nervous and pulled profits to put wheat on the defensive this week.

This pressure will probably continue going forward as we go through the growing season, unless weather concerns reappear to prop markets up.

Continued aggressive purchasing of U.S. beans has ending stocks very tight and any reduction in acres or loss of yield due to weather will certainly continue to support bean futures into the harvest period. This will help support other oilseed products including canola.

Currently the trade is estimating total seeded acres for canola larger than last year’s crop, which should mean ample supplies. If we continue to experience growing season delays with cold weather and/or drought concerns, yield will no doubt be impacted and total production will be below last year’s levels, which would be supportive for canola.

It will continue to be a volatile market as we go through the growing season because it is a big unknown until the grain is in the bin and we know what we have for inventory.

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.

CORRECTION, June 8: Beans were down four to 22 cents per bushel Friday, not down four to up two.

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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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