Factors impacting the market this week.

[charliep]

What factors will you be following this week and strategies coming out of them.

Some will say they saw it all along but have to admit to being amazed by the wheat rally. Likely as much millers short supplies as anything and funds there to maximize pain.

Looked for comments earlier on seeded acreage and will try again. My take is that wheat has moved up the ladder in terms of per acre profitability and will replace barley in rotations in a major way. Canola will also be interesting as farmers look at cost/acre versus risk they are willing to take on in the different crops.

[agstar77]

Why would you be surprised by wheat demand? There is inelastic demand ,if there is a shortage you can only ration demand by price not substitution. Oilseeds are generally interchangeable and there is also palm oil. Wheat will drop when production catchs up, not until. Durum is in a similar position. Having said all that, wheat is the most widely grown crop and production could rise rapidly.

[SASKFARMER3]

The India factor is a concern with crop 2% less and its still dry I don't believe they will add to production. The squeeze will continue the US is Dry and Cooler than most years. On Durum look at the precip maps for ND AND Montana low moisture if this continues in spring southern Sask could be also in that major durum growing area. The wheat and current prices that we are not getting still weigh on 70% of the farmers out their and that is the largest reason why wheat will have a hard time getting acreage. Farmers are Pissed and once burnt twice shy. or some thing like that.
Canola and peas could be the major challenge. A 45 bushel pea crop at $8.50 locked in for next fall 382.00 low inputs vs 12 x 40 with high inputs. But their is also this year Mustard and Flax that are buying for acreage plus lentils etc. I feel it will be a continuation of what we saw last spring. North could be back with canola though from years of flooding.

[charliep]

Went to do my normal Monday afternoon task of looking at historical (not updated) so went straight to the CWB area to check out current producer pricing option values. Old crop DPC/FPC (depending on where you live and what your adjustment factor is in the later case) values for 1CWRS 13.5 somewhere in the $11.50 to $11.75/bu range versus a PRO of $8.40/bu (Jan. 24 so current). Not a US price but pretty good.

Farmer who have unpriced DPC and FPC will be signing the "B" series and relaxing - they will get paid a good payment/price. Anyone who has not used these (or already priced) will be loosing sleep wondering whether to contract or not ("B" series deadline Thursday).

I suspect farmer will be observing this and making plans to increase their use of contracting programs. Most farmers I know are aware of the benefits of the programs and are pushing for more.

[Hopperbin]

At the moment my higher than normal pea acres which were decided in Nov. will stay unless my seed has a germination problem in which case I may be forced to grow something else. I booked a high rate of fert. on the canola and wheat so could spread it aroung a little with a lower rate. I will have a little less soft wheat, which could turn to barley but as you mention Charlie the wheat market would have to soften, basis contracts to come out soon hmmm, not sure exactly when, not to mention I will have more of a storage problem, barley is more difficult to store and keep. I believe the world malt and feed barley is strong in the world but that is all just a gamble as the board does not give prices, freight rates likely to stay high, another gamble. local markets for barley seem to be dissappearing. Midge is a huge problem for my area which is actually a pretty large area, lets not forget, the spraying window for midge is pretty narrow and the chance of hiring a sprayer on time may not be good, midge damage I expect to be 50 percent or more this coming year if not sprayed. My Canola acres are contracted for specialty canola so that is not to change and the prices look good, even have a better variety this year. Saskfarmer I believe our pea exports to India are dependant on the fact that we can fumigate them in India and not Canada. That door could be closed any minute but not likely if they need it.

[Hopperbin]

Charlie farmer who have had daily or fixed price contracts weather fully or partially priced would already have signed an A series contract. Why would they have to sign a B?

[dalek]

Sold more 2009 SRWW late today as well as a big swat of 2010. Buyers here are nervous about going out farther and have stopped contracting 2011 and 2012 or I would have sold it too.

2009 SRWW $250/tonne
2010 SRWW $253/tonne


Now sold as much as I'm comfortable with unless I can find more land (looking hard) or throw the rotation out the window (tempted)

[Hopperbin]

I take it you sold to an Ethanol plant.
How far are is your haul? To which plant?

[dalek]

Sold to an Ontario elevator, 45 km away.

[Hopperbin]

Ahhhh should have known you were from Ontario from a past post. So what is the current today price on that stuff anyway?

[dalek]

Soft red delivered today, $290-305 depending where you are.