Wittal: U.S. rains may yet shift acres to beans

Our online grain markets columnist Brian Wittal 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.

May 6 — Financial and energy markets are up today, which helped to support grains overall.

Corn and bean plantings in the U.S. are progressing, but calls for more rains in some regions could play havoc with seeding intentions and eventual shifting of acres between corn and beans.

If the weather stays nice and corn can get planted, bean acres will be down and futures will stay relatively strong. If rain delays cause acres to be shifted from corn to beans, then bean futures will be under pressure as acres grow.

Canola is following beans very closely for the same reasons.

The rising Canadian dollar is going to put pressure on canola futures values, but if seeding is delayed, futures will hold at current levels through spring. The strong jump in crude was enough to counter the rising dollar and helped push oilseeds higher today.

Once seeding is done the basics of supply and demand will take over as the market focus. Old-crop canola stocks are seen to be adequate, and if seeded acres are anything near last years, futures will come under pressure into harvest and beyond.

The Dow Jones closed up 102 points today. The U.S. dollar finished down three-10ths of a cent today, while the Canadian dollar was up 0.63 cents to close at US85.68 cents.

Crude oil finished up $2.50, closing at US$56.34 per barrel for the day.

Corn finished up one to two cents per bushel today while beans finished up 15-19 cents per bushel wheat finished up one to eight cents per bushel today. Canola is up $5 to $9 per tonne for the day and barley is up $1.10, closing at $141.30 per tonne.

Here’s some noteworthy news: the European Union and Canada agreed on Wednesday to launch talks on a trade deal expected to be worth another US$27 billion each year to their combined economies.

“It is a great success today. We signed the start of a process leading to the deepening of our economic cooperation,” Czech Prime Minister Mirek Topolanek, whose country holds the EU presidency, told a news conference, according to Reuters in Prague.

Canada and the EU first agreed in October 2008 to seek a “comprehensive economic agreement” to boost two-way trade by lowering tariffs on goods and services, and encompassing areas such as investment, regulatory cooperation and rules of origin, Reuters said.

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.

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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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