Barley had a tough week as pricing pulls back in all areas. Corn is being brought up from the United States at considerably cheaper values, which our buyers suggest is now heavily affecting barley bids. This shouldn’t come as much of a surprise to most as anticipation of this event has been lingering over the market for a few months. Not all is lost though, as bids remain historically strong, now ranging from $8.25 – 9.00/bu picked up on farm, the latter of which is indicated for Southeast Saskatchewan. There are still a few active bids available for January – March movement, however, we now see some buyers push delivery windows to an April – June timeline. As long as corn keeps getting brought up, we can expect barley prices to remain bearish. If you’re looking for new crop bids, call your merchant with location and we can find a picked-up price.
The chickpea market continues to be a topic of “non discussion” these days. Demand remains slow and it seems neither buyers nor sellers are willing to budge off their desired purchase/sales targets. There remains some pricing interest for large Kabulis around the $0.55/lb FOB mark, but bids are starting to push into Jan.-March delivery time frames. Buyers continue to look for decent sized product at these values with discounts for over 10% 7mm sizes. New crop bids remain slow, but we have seen offers trigger at $0.35/lb FOB farm with a 10/bu to the acre AOG attached. StatsCan came out with a drop in chickpea production, however not we are not overly convinced that this number is a shocker to anyone in the chickpea game. Targets are the way to go it seems, as there may be sporadic trading taking place and if you have a sales value in mind, we suggest being in front of the market rather than behind.
The flax market has backed off a little on price the past couple weeks as buyer interest has waned. Not to say that sellers are still overly aggressive either; it’s been a pretty passive market as of late. We still have a few trades being done in the low $40’s range this week depending on movement window, but there are bids sub $40/bu as well. Trying to predict what the market is going to do is difficult; on one hand we have very tight supply in North America, but on the other hand we see China and Europe continuing to purchase at lower values from the FSU, which has our product priced out of the market. So, expecting that our bids will go back up from these already crazy high levels is a tough road to walk when other parts of the world are selling cheaper. That said, limited supply still hangs over the market, so who knows what may develop in the future. Regardless, bids are at great values and making a sale to take one issue off your plate is not a bad idea at these levels. New crop values are still very attractive at $24/bu picked up on farm with an act of God, which offers protection against drought problems, unlike other crops without that assurance.
Canary seed values are sideways again this week with bids stagnant in the 50-cent range picked up on farm. Some analysts are concerned about 2022 canary seed yields after a drought year, as history shows that soil moisture takes some time to recover. This could translate into yield projections being on the conservative side of things. Currently, new crop bids are hit and miss at 35 cents/lb picked up, with an act of God. Exports from Argentina are ahead of last year’s pace with their 2021 crop recorded as over double from last year. With North American canary and millet prices both off from the harvest highs, it’s no surprise that the short-term demand has been filled. There could be a seasonal bump after the new year for spring shipments.
Both milling and feed wheat markets remain well supported due to tighter available supplies and thus increased buyer competitiveness. Feed wheat is somewhat moderated by the import of US corn destined for intensive livestock production. The global wheat story remains rather unchanged; too wet in Australia, a little too dry in the U.S. Plains and Canada, struggles with production and now shipping issues along with export taxes in Russia. Feed wheat values are trading near $11.00/bu – $11.30/bu picked up on farm, location dependent. Milling wheat values are quoted at $12.60/bu FOB farm on for #1-13.5% protein product. 2021 Canadian durum production is between 40%-50% of the previous 5-year average. Most of the durum production will flow to North American domestic mills. Durum bids have been holding firm around $21 -$22/bu delivered.
Dry Bean exports out of Canada have been steadily on the incline to Europe since mid-2018 partly due to tariffs on the US, which will soon be coming to an end. Exports for the year thus far have been in line with previous years but could move to a reduced number as a result of lifted tariffs. The Brazil crop is reported as fair, which could mean another bear for Canadian and US supply. Faba beans out of Australia are reporting a slight increase in production of 2% and while this may seem insignificant, it is still a new record and will weight on global markets. Despite beans being at elevated levels, the movement out of North American markets is slow. A push for export demand is what will keep these values strong, so all eyes are on Australian and Latin America’s production for quality and quantity.
Very little change this week in lentil markets as StatsCan’s drop in production numbers across all types of lentils was widely expected by the industry. Red lentil pricing in Australia has seen a small uptick, which is starting to have more importers looking back to Canadian origin. While this renewed interest hasn’t been enough to increase our prices, it is something to keep an eye on moving forward. Red lentils are trading today at $0.45/lb FOB farm for #2 quality. The large green lentil market took a small step backwards from some shallow demand we were seeing last week but is holding on between $0.61-$0.62/lb FOB farm for #2 quality with movement in the new year. Small greens are trading sideways at $0.60/lb FOB farm for a #1. New crop bids have started to slowly show up over the past couple weeks as well. Large greens are around $0.40/lb FOB farm and red lentils are between $0.32-$0.33/lb FOB farm. These contracts include an AOG on the first 10 bu/acre. If you have price target in mind for old or new crop, don’t hesitate to let your merchant know so we can get a firm offer out to our buyers.
Mustard continues to lead the pack of Canadian grain markets. Yellow and brown are the top dollar catchers with oriental following only slightly behind. Yellow and brown mustard are now both trading at $1.25/lb FOB, or higher, while oriental of any variety should catch $1.00/lb FOB farm. The mustard market is on an incredible run all around, but inhouse documentation shows yellow mustard bids, in particular, have tripled since June and the average trade since September pencils out to about 91 cents/lb. Growers should also note the 4-year average is 42 cents/lb; that puts todays current bid of $1.25/lb, at minimum, 83 cents/lb higher than the 4-year average. New crop continues to trade at historical values as well, with bids in the mid 60 cent range for brown, 70 cent range for yellow and 60 cent range for oriental. This puts new crop values at 1.5 to 1.7 times higher than the four-year average. At these levels it may be a good time to look at growing mustard for the upcoming season and taking advantage of the outstanding new crop values.
The oat market has developed into quite an interesting story. On a percentage basis, oats are the highest gaining commodity in the world, even surpassing the metal Palladium. Quite remarkably, oat futures have also outperformed every major stock market index. Today, the highest spot values remain at $10.00/bu FOB farm for Jan.-Feb.-March movement on a #2 milling quality. Perhaps more important is the discussion around new crop bids. Taking some time to pencil out oat returns on a new crop program and consequently some truly outstanding crop insurance benefits is important this year. Please call your merchant as prices are being quoted in the $7.00/bu FOB range. These contracts are without an act of God, but some buyers have agreed to rollover any short fall in tonnage to the following year. At current pricing levels, sales on both old and new crop have risen to one of the top returning cereal crops. We may have some seed options left, so please touch base with us on that also.
StatsCan’s satellite imagery prediction from September (12.78MMT) seems to have been fairly close from the reported numbers of 12.59MMT of total production of canola. However, this glaringly low number rivals that of the production levels back in 2007. We continue to see pricing fluctuate as of late due to the strong Canadian dollar as well as the USA’s EPA liquidating some long positions. As of writing, January futures are sitting at $1006/MT up from $986/MT last week with March futures at $981/MT up $21/MT from the previous week. Flipping over to new crop, Nov ‘22 futures sit at $772/MT.
The “two peas in a pod” quote can be used to describe the current pea market as it remains much the same as last week. Yellow peas continue to be bid around $17.00 – $18.00/bu FOB farm depending on area and delivery window. Green peas remain in light trade with bids floating between $16.00 – $16.50/bu FOB. Maple peas are flat lined around $18.50-19.00/bu FOB farm with many growers still targeting the highs of $20/bu seen earlier in the year. Although actual trade seems to have backed off a bit, these are still great historical values for peas of all kinds and growers are encouraged to take advantage. Not much talk about on the new crop side of peas this week except for yellows, where growers may be able to obtain a $13.00/bu FOB farm contract including an act of God for 10-20bu/ac. As far as green and maple peas go, we suggest using a firm offer if you have a target in mind. As is true with many commodities this year, buyers may not be interested in securing as many acres due to the perceived high values. Playing the “wait and see” game may not be successful!
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.