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Wittal: USDA report neutral-to-bullish on wheat, corn

Sept. 11 –– Outside markets continued their somewhat lacklustre trading pattern this week, as financial markets ended mixed and energy markets ended down on the day and the week overall.

The U.S. dollar closed down a further 0.13 cents today, down 1.5 cents this week. The Canadian dollar closed up at US92.87 cents, up three-quarters of a cent this past week.

The Dow Jones September quote finished down five points at 9,600, up 185 points over last week.

Crude oil is down $2.65 per barrel at US$69.29, up $1.27 over last week.

Corn closed up four to five cents a bushel today and up 14 cents a bushel for the week.

Beans closed mixed, with the September futures up 11 cents a bushel and the forward months down 19-24 cents a bushel on the day. The September futures are up 23 cents a bushel for the week.

Wheat futures closed up four to 10.2 cents a bushel on the various U.S. exchanges. Minneapolis September wheat closed up 4.2 cents a bushel today, down 18 cents a bushel for the week.

Canola closed down $4.40 to $5.70 per tonne today, and down $5 for the week.

October Western barley climbed $1.10 per tonne, closing at $113.10. November futures are up $1.70 per tonne at $142.80 and down $3.50 per tonne for the week.

The U.S. Department of Agriculture’s report came out as expected with yields and production numbers for all grains up over last month, but not out of line with trade expectations. The report was seen as neutral to bullish for corn and wheat and neutral for soybeans.

This forced all grains into the red at the start of trading; however, corn and wheat were able to climb back into positive territory before the day was done.

World end stocks and production estimates were tweaked slightly but there were no real surprises.

Canola futures continue to follow beans lower, and with the imminent threat of frost being pushed back in the forecast, it’s expected futures will fall back to recent lows, in the $388 per tonne range or lower.

The next threat of a general frost for the Prairies is said to be on or around Sept. 22, the autumnal equinox, which would give most canola crops enough time to mature out of harm’s way, hopefully, depending on how hard the frost is.

The take over of ABB Grain by Viterra was approved yesterday by Australia’s Federal Court. This will move Viterra from being a top-10 grain company to a top-five grain company in the world.

Sources confirm that a number of upper- and middle-management individuals are heading over to Australia immediately on one- to three-year terms, to help in the transition and amalgamation of these two companies.

Will this add any bottom-line benefit to producers? We will have to wait and see.

I think the only way that may happen is if you own shares in the company. The days of the co-op philosophy of “profit sharing with its members,” as per Viterra’s roots, are gone, which is too bad.

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.

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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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