The canary market continues the same path it has been on for quite some time. Reduced acres this year were negated by a higher yield than the previous year (apparently), which pegged this year’s production similar to last. This production repeat has not seemed to foster any market strength as the traders all seem to know of tonnage still in bins from prior year’s that haven’t yet moved as well. Early estimates project the acres to increase in 2018, most likely due to weakness in other markets and producers looking for niche market options. Current bids are still around 20 cents per pound picked up at the yard, while the occasional firm grower target at 21 cents gets picked up for good Mexico quality product, or in areas with a freight advantage to particular buyers.
Barley markets soften slightly this week as the major substitute, corn, loses some ground. As has been the case for months now, corn values are a main determinant of where barley pricing lands. If corn becomes cheap, feeders will substitute it for barley and vise versa. Bids today are hovering in the $3.85-$4.00/bu FOB farm, pending location. News from our buyers suggest that the Manitoba feed market is mainly focusing on corn, with little to no room for wheat and/or barley, further limiting our options. This means that the majority of product must head west into southern Alberta’s “feedlot alley”; something to keep in mind. Other news suggests that local corn tenders are in play and China is not going to import near the amount of malt barley as previous years. If these come to fruition, we could see feed markets continue to soften.
There hasn’t been a lot of change in the oat market over the last couple of weeks. Milling oats are seeing values around $2.50/bu picked up on your farm. Feed oats are still seeing favorable values at $2.20/bu picked up and in some cases higher when freight is advantageous. There has been more action on the feed oat side of things when compared to the milling, as many milling sellers are looking for closer to $3.00/bu. We might be able to get bids closer to the $3 mark if growers are willing to push movement out and are situated in the southeast corner of Sask. This is due to most of our milling buyers looking for product into southern Manitoba. If you have off spec oats (heated, light weight, etc.) talk with your merchant, as we have buyers who can move this product.
Lentil markets have shown a little life in recent days in defiance of growing ending stocks. Ending stocks are forecasted somewhere near 740,000 MT, which is up over 80% from 405,000 MT in 16/17. The green vs red lentil stories are slightly different, with reds absorbing the brunt of downturns in international trade volumes. Green export volume is forecasted to drop minutely, whereas reds will absorb the lion’s share of export losses estimated at a 700,000 MT reduction. Ultimately, as we all know by now, this situation is politically motivated by the Indian government to stave off imports and thus prop up local farmer prices. India’s planting pace of this year’s rabi crop is both ahead of last year and the 5-year average. India’s current planted acreage of lentils exceeds last year by over 200,000 acres. Current prairie bids are 18-18.5 c/lb FOB farm for red lentils, 27-28 c/lb FOB small greens and 29 FOB large greens.
Yellow peas are unchanged, and we are seeing values of around $6.50/bu delivered. There is a bigger bid in the southeast corner of the province at $7.25/bu picked up; which is a very strong price in today’s pea market. The green pea market has traded sideways this week, with $7.75/bu FOB farm or $8.25/bu delivered, with January pickup being the average trade. India has reported no change on the yellow pea tariff front yet, so trades are being sought out in other countries. We have heard from buyers, that several countries, such as China, have got to pick up the buying pace, but they are looking for value at this point, not willing to pay any premium as they are well aware of the Indian issue. There are still no new crop contracts available on peas with Act of God, but perhaps this is something that develops in the new year.
Chickpea prices seemed to have leveled out over the past couple of weeks with #2’s indicating 62 cents/lb picked up. We are seeing new crop pricing in the 39 cents/lb range on a #2, picked up with an Act of God. Demand for chickpeas has been strong with Turkey being the largest buyer followed by Pakistan and India. While global prices have been strong, some analysts are not sure how much longer that will last. Kabuli prices in India are under some pressure as supplies become more comfortable. The planting pace for India is also well ahead of last year, which could mean a heavy supply situation for chickpeas. Australian desi chickpea prices have continued to slide with weaker prices in India despite the rains, as most of the crop was harvested before then. The market has avoided a crash in prices, but that could change once Mexico and India are closer to harvest.
A fall in the canola markets this week with Tuesday and Wednesday both hitting the lowest future values in two months. After falling $2.40/MT yesterday January closed at $500.10/tonne. Today we are seeing a $1.40/bu drop, which works back to $498.70/tonne. With the large supply of canola compared to last year, we may see a bit of drop in prices, but this also could be seasonal lows. By the sounds of things, big acres will be seeded again next year, so maybe thinking about locking in some tonnage for off the combine movement might be a good play. Today new crop prices some elevators are at roughly 25 under as a basis, which works back to $10.80/bu delivered to plant.
Flax had another quiet week in the market place with dollar values holding steady. Markets should remain fairly stable after last weeks StatsCan numbers, as ending stocks are pegged at less than 100,000 MT this year. Export business may be slow going this year, as the FSU has lots of product to move. The North American market needs product, therefore helping to sustain the current values. Yellow flax has been trading at slow pace this year, with most trades taking place around $14.00 FOB farm. The question is, ‘why is yellow flax lagging?’ One reason could be that producers took advantage of the high price acreage contracts last winter. That combined with a slower market, buyers may not be in need of extra tonnage at this time. Yellow flax is hard to get a good handle on for real numbers as not many reports breakdown the specification between the two commodities. No new crop pricing has become available yet, but will likely start to show up in the early part of the new year.
The mustard market continues to be the star of the show in an otherwise quiet market. Significant volumes of both new and old crop have been trading with attractive pricing on the table. New crop bids remain at 33-35 cents/lb on oriental, 35-37 cents/lb on brown, and 38-40 cents/lb on yellow. All contracts are picked up in your yard and include a full Act of God clause. Spot prices see a small uptick with brown trading at 44-45 cents/lb, yellow at 43-44 cents/lb, and oriental at 32-34 cents/lb. All of the spot prices are picked up in your yard. If you are looking for any seed, we have certified yellow and oriental, with some common brown available at competitive prices with delivery to your yard. Call your merchant for more details.
The price on feed wheat is still sitting around that $4.75/bu range in most areas of the province. There is a possibility that you could get $5.00/bu in the right area, where freight costs are cheaper. Buyers are not too concerned about vomi numbers this year because of quality that has been taken off. It is a far cry from last year where vomi levels where an absolute nightmare for a lot of buyers and producers. For product with vomi levels between 1ppm to 10ppm you can be looking at around $4.00 per bu. There are still some very competitive durum bids out there for a #1 with 13+ protein. It ranges from $7.50 /bu to $8.25/bu depending on area. For example, if you are in the Southeast part of the province you could get more of a premium compared to someone by Saskatoon. Hard Red Spring wheat prices are a little bit harder to find, but if you are looking for a bid, give a Rayglen merchant a call.
Soybean futures suffered losses over the past week as improving weather patterns in South America have pushed markets below their recent support levels. The USDA report weighed down soybean contracts after it raised U.S. ending stocks by 20 million bushels over its previous estimate. Take home message is that the globe continues to produce more and more soybeans. To that end, it’s projected that 2018/19 US soybean planted acres will continue to surpass corn due to better profitability. There are a couple of interesting items in the overall soybean complex. Powered by a potential La Nina event, institutional traders have taken bullish positions in CBOT soybean meal banking on Argentina’s dry weather forecast. Argentina is the world’s leading meal exporter. Local soybean bids are $10.85-$11.00/bu FOB farm range depending on location. Local faba bean bids are in the $5.75/bu range for feed and the faba export market opportunity appears to be fading.
Rayglen Market Comments are for informational purposes only. Rayglen Commodities and its agents or employees shall not be liable for any loss or damage suffered by any person as a result of reliance on any of the contents contained within these products, whether such loss or damage arises from negligence or misrepresentation or any act or omission of its agents or employees.