Flax has lost some traction again this week and only time will tell when we see that market start to settle and find its bottom. New crop bids are also becoming a bit sparser, but a few contracts are still hitting the books when growers use our firm target system. Canadian supplies are historically tight but due to acceptable Black Sea inventories, Canadian supplies are manageable for the export market. Analysts suspect below average yields for the 2022/23 year unless there is some relief in soil moisture. Based on a cautious yield of 20bu/acre, and early planting intentions, there is suspected to be 12% more flax supply than 2021. Right now, the trade is thin and for the Canadian market to find renewed demand from China and Europe, we suspect prices will need to drop further.
StatsCan estimates didn’t have much of a shock factor regarding peas, with supplies being reported 43% lighter year over year. These estimates were expected and if anything, prices were reduced again this week due to slowing demand. Right now, we see Australia’s crop is making its way into market and soon India’s crop will compete for market share. Notably, current weather conditions in India are favorable and this warrants an expected bump in yield. There have also been reports that Russia and China are taking steps to work together and have already lowered phytosanitary barriers, which will create more competition for Canadian peas. Today, pricing on yellow peas is at $16/bu, while greens slipped further to $12/bu FOB farm in some cases. Depending on variety, location and movement, maple peas have been trading at $14.50 – $16/bu FOB farm this week. New crop bids on maple and green peas remain slow, but we still have options available for yellows. Bids are now indicated slightly lower at $12 – 12.50/bu FOB farm with act of God in southeast Sask.; a good price to consider locking in 10bu/ac.
While most commodities have, for lack of a better term, taken a beating over the last couple weeks… oats remain the outlier only seeing small corrections while still holding most of their value. A #2CW old crop oat is still triggering around that $9.00/bu FOB farm for a delayed shipping window. New crop continues to be bid around that $6.00 – $6.50/bu picked up range, all dependent on area as well as time frame of movement. Although new crop contracts don’t contain an act of God, roll over options for quality and quantity loss may still negotiable, so make sure to ask your merchant if this is an option when contracting. Although posted bids for feed oats don’t seem to be as abundant, buyers are still looking. Your best bet is to let us know what you have and let us track down top bids.
It was mentioned last week that the GULF Foods trade show was taking place overseas, which has a large special crops presence. With all these buyers and sellers under one roof, markets tend to shake up and this year is no exception, especially in regard to chickpeas. In the last 24 hours the tone on chickpeas has started to shift. The market has become muddier with discussion of long positions and the word “liquidate” popping up. As a reaction to the rumor mills, buyers have started to hesitate when pulling the trigger on purchases or have even moved so far as to put a hold on bidding. Current indicated levels are now in a wide range from $0.35-$0.44/lb FOB farm, while new crop is quoted around $0.28-$0.30/lb FOB farm with an AOG with limited availability. On a global scale it is believed that chickpea consuming countries have been chewing through stocks, which should turn into demand mid summer. At the moment though, growers are deciding if they should hold or even if they should plant next year. If chickpeas weren’t clouded before, I’d say they are in a storm right now.
Barley prices continue to hold up to strong levels, with $8 to $8.75/bu range tradeable on farm to the feed market on min. 48lbs and dry product. On farm stocks are expectedly about as low as we have seen in quite some time, sitting at less than half of what we have had in some recent years. With the influx of US corn to Canadian feedlot rations, the prices have accounted for the lack of barley, but it is still a stark number to see and provides that the prices should remain supported for a while yet. New crop opportunities are strong at $6.50 to $6.75/bu range on farm, but do not carry an act of God clause on the deal, so the farmer trepidation to sign up tonnes for the fall obviously is warranted.
Based on StatsCan, it’s estimated that around 10,000MT more canary seed sits in the hands of the commercial user this year compared to last. Though export numbers are still under what needs to be shipped for the rest of 2021-2022 that extra bit buyers are sitting on continues to slow down the immediate need to lock in supplies as we move into spring. Suggestion is that even with tight stocks, a decent amount of the spring export sale has been covered. So far, pricing seems to be holding on with bids sitting at $0.45/lb delivered in. New crop looks to still hold strong value as well with $0.36/lb delivered in for Sept.-Dec. with a 10bpa AOG.
Canola markets have been a mixed bag as nearby has seen a small increase after an up and down week. May futures sit at $1013/MT at time of writing after seeing $1007/MT at the same time last week. July futures have seen a very small increase to $984/MT from last week at $981/MT. After a rise earlier in the week, futures dropped due to pressure from a correction in crude oil prices. Most of those losses have recovered today as crude oil has stabilized. StatsCan numbers released this week were in line with expectations as ending stocks at the end of last month we listed at 7.56 MMT. People now look to the USDA report being released later today to try and get a handle on where the market will move after trading largely sideways of late. November futures are at $845/MT, which is exactly sideways from last week as producers continue to lock in values around $18/bu for next year.
Mustard continues the week with great, but flat pricing. We seem to have found the sweet spot for now as bids have been sideways for nearly a month now. New crop contracting has certainly picked up recent weeks at these terrific prices and old crop continues to trickle out of the bins. New crop brown and oriental are trading in that 70-75 cent/lb range, with yellow at 75 to possibly 80 cents/lb. New crop mustard contracts include an act of God & are picked up on farm. Spot prices remain at record highs, with yellow and brown being quoted around $1.50 to $1.60/lb FOB while all varieties of oriental are quoted at $1.00/lb or better. Now that we approach mid-February and prices are sideways, is it time to move on this old crop pricing? It’s definitely something to discuss with your merchant as buyer have indicated a potential slowdown in purchases and value. Please call for information on all types of certified seed, treated or untreated, and delivered to your yard. We are getting very short on yellow, so we urge growers on the fence to make the decisions sooner than later. Brown and oriental supply remains available.
Lentil markets continue to soften with little overseas interest in Canadian lentils at the moment. Even with the StatsCan report showing a 36% drop in supply, this has had no effect on the market. Lentils will likely be in a tough battle for a while as Australian product moves into the market and we continue to hear positive news out India. This, paired with the fact that Canadian lentils are overpriced compared to our competitors, makes it tough to demand higher values. Reading into the market would suggest many countries guessed Canada was going to be short product so they started rationing supplies early in the year while waiting for the large than normal Australian crop. With an oversupply coming out of Australia and perceived average to above average Indian crop, there is no need to panic buy Canadian product.
Wheat received a bit of a surprise this week after the release of the StatsCan report. The December ending stocks were reported even lower than most expected, 56% lower in fact, compared to 2020. This surprised the market a little as this number was not projected and can be attributed to more wheat being used at the beginning of fall, which helped deplete stocks. This news has helped wheat prices rally this week and it continues to edge higher again today after the USDA released their latest WASDE report. Tighter supplies should have growers watching this market closely.
Today’s USDA WASDE Report trimmed about 239 million bushels of soybeans out of the forecast South American production number. This added wind to the sails of Chicago futures and soybeans hit highs last seen in July of 2013. Local bids are location dependent and range from $15.50 -$16.50/bu fob farm. The dry bean market remains adequately supplied due to modest demand. Mexican and Argentinian crops are not currently experiencing challenging growing conditions, so prospects remain favorable. These factors have extended some price pressure on bids. There has been little change in the faba bean market. Domestic feed pulse market remains as dominant market driver. Feed faba bids are in that $13/bu fob farm and when #2 demand periodically occurs it is often near $15/bu fob farm.
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