StatsCan has released the seeded area estimates and mustard acreage for June 2021 has come in at 306,000ac. This was expected by us here at Rayglen, as the April report of 358,000 acres seemed a bit high. These estimates are still almost 20% higher than last year, but it’s a number that doesn’t seem to matter right now. Growers have concerns over extreme heat, wind, or drought conditions and that is obviously keeping bids strong to even slightly higher this week. Yellow mustard is at $0.50/lb FOB farm for old crop and as high as $0.52/lb for new crop. Brown mustard sits at $0.43 for July movement and $0.42 on new crop. Oriental mustard is still being bid at $0.35/lb FOB farm for Forge & Vulcan varieties, with the same discount to $0.33/lb FOB farm being seen on Cutlass variety for both old and new crop. Call your merchant if there is a firm offer that you’d like to show our buyers and we will do our best to get it traded.
It has been a solid week in the canola futures markets, with some big jumps before and after the release of the USDA. Strength in the soybean market as well as weakness in the Canadian dollar are giving support to canola, but the current heatwave and forecasted high temperatures across Western Canada seem to be an additional factor in recent price strength. November futures are currently sitting at $807/MT, up from $729/MT last week. Futures have seen about a $12/MT gain (at the time of writing) after the USDA release. Going a bit further out, January futures are also seeing similar gains this morning currently sitting at $802/MT, up from $728/MT last week. We are seeing strong local basis levels and contracts for November delivery hit $18.50/bu or higher. If your crops are in a stable position, these values may be worth a look.
At this point in all markets, chickpeas included, weather is a larger factor than the supply and demand numbers expected tomorrow. In previous weeks, chickpea markets have reported higher than expected export numbers, but the carry from previous years is large and old news. The factors to watch today are dry and hot weather. While this will not mean a disaster for chickpea acres, it could translate to a smaller calibre crop. As long as quality is maintained there will be markets for small sizes, but we might expect to see a larger price spread between 7mm and 9mm as larger size becomes less common. Values remain unchanged this week as weather keeps everyone guessing.
We continue to see strong values on old crop feed barley with product trading around $6.15 – $6.65/bu picked up on the farm for July movement. With most product destined for feedlot alley, those in SW Sask. and Alberta should see the strongest values, but a few locations outside those areas are also capturing highs. Pricing support should hold for the next couple weeks as corn climbs higher after the release of the USDA. New crop values continue to hover in that $5 – $5.50/ bu FOB range which looks attractive, if you aren’t being pressured by the brutally hot weather and ever encroaching drought conditions that seem to be gripping a decent swath of the Prairies. A 9.7% increase in seeded acres this year over last may allow for a bit of a buffer, so to speak, should yield not quite be what is expected. Looking globally, over the next week or two, new crop barley harvest will be running full tilt in some areas of Europe. As such, we’re seeing pressure on CDN pricing as new crop barley is currently trading at roughly a $30/MT difference between the two with the former holding the cheaper value. The biggest issue appears to be making it through the next week to 10 days of weather.
Flax estimates from StatsCan don’t show any big changes from previous reports; acres up around 10% from last year. Exports have dropped slightly over the last couple of months and will continue to do so until new crop becomes available, due to limited supply in the bins. Prices are still holding at $23.00/bu picked up for late Summer movement, while new crop varies anywhere form $18-$18.50/bu depending on movement time frame. The biggest thing to keep an eye on are the reports coming out of the Black Sea region as Russia is expected to have a new flax acreage record for 2021/22. There are also reports suggesting the Russia/Kazakhstan regions still have available supplies overseas. If you aren’t already receiving our email and/or text alerts, make sure to call the office so we can get you set up for those busy days in the field.
Canary seed prices remain firm with new crop bids creeping up to match old crop values this week. Trades are now taking place at $0.35/lb FOB farm in most locations on both product in the bin and also in the field. New crop contracts still include an act of God, making this a strategic move to get something locked in at historically high values, while alleviating the risk of drought and/or other uncontrollable factors. Typically, old crop prices tend to drop around this time so seeing the market maintain $0.35 could warrant a second look at moving product in the bin. Given the heat we’ve seen over the past couple days we understand it may be difficult to make those sales decisions right now, but it’s something to keep in mind for the near term. Cashflow, bin space and delivery windows are always something to keep in mind.
Not much new to discuss in the oat market lately, which seems to be a common theme over the past few months. Old crop trades remain next to NIL with new crop seeing much of the same action. We’ve had some renewed interest on old crop with buyers looking to purchase some heavier weight milling product for prompt shipment at the $3.50/bu range in Central SK., but the sell side is slow. New crop values sit around the $3.50 – $4.00/bu FOB farm dependant on freight and delivery window. If you are looking to get some locked in, we would highly suggest doing so now given the potential roll over of old crop into the 2021 harvest year. It seems to be a supply vs. demand game right now and the demand aspect is outweighing the supply portion. Reach out today to learn your best value or consider throwing a firm target out.
The wheat market may not be at the tip top highs seen earlier this summer, but values are still awfully strong overall. Feed bids range from $7.40 to $8.50/bu picked up on farm depending on the location of grain. New crop feed bids have pushed up over $7/bu in many areas of the province making for some unreal pricing opportunities for those willing to lock in a guaranteed delivery contract that doesn’t cover quality and/or quantity loss. Bids on #1, 13.5 CWRS are shown around the mid to high $9’s in many areas of the province in the nearby, while prices into Fall are still catching a little under $9.40/bu at this time. Milling durum bids are brisk in certain areas, with SE Sask. numbers showing $9.50 to $9.75 picked up on farm for #1 US Durum with 13% plus protein for Fall months as a picked up on farm price. Again, a great option albeit with no act of God clause.
Soybean acres and stocks reported lighter than the trade expected in today’s USDA report. Futures have responded sharply up. Yield potential remains relatively bullish, although there are still plenty of lingering questions as the season unfolds. Latest StatsCan acreage report posts fabas with a 28% year over year acreage increase to a total acreage of 127,000 acres. Old crop feed quality fabas have been trading between $8.50/bu and $9.00/bu picked up on farm. As previously stated, Canadian dry bean acres are down 18% year over year and hover near 373,000 acres. Production challenges continue to be reported in in the major dry bean states of North Dakota and Minnesota. Dry bean prices remain firmly supported. Contact Rayglen with your specific class and quality for marketing opportunities.
StatsCan seeded area estimates came out on Tuesday with a slight drop in peas of 19,000 acres from the earlier April estimations. Year over year, green acres were decreased by 221,000 from 2020, followed by yellows at 160,000 and finally “other varieties” down 49,000 acres. Possibly the most interesting aspect is a 28% drop in seeded acres for “other varieties”. This could cause some concern for buyers looking for maple, dun, and marrowfat peas this coming crop year. Carryover and demand should be the only factor to slow price gain. At this point, moisture concerns across Western Canada and generally lower seeded pea acres should mean a strong outlook for the coming crop year.
The seeded area estimates for lentils may surprise some as acres only increased by 100,000 from the April estimation. This increase barely put us ahead of last year’s numbers with the biggest difference being large green lentils are down nearly 21%. Most of those acres seem to have shifted to reds, but also worth noting is a 15% increase in small greens. The specialty lentil acres were also decreased by 10%, which is not surprising as these markets have not been competitive in pricing compared to the other lentil markets this year. With the decrease in the large green acres, we hope to see some price improvement in the future, likely with an initial push for #1 large greens as at harvest time as there will be very little to none left in the bin due to colour loss. The #2 market may be discounted more than usual as there seems to be a decent amount left in the bins heading into the coming marketing year. Instead of seeing the usual 1-2 cent spread we could seed a 3-4 cent gap depending on this year’s crop quality. Don’t expect to see a big price run on lentils just yet as the overseas trade is still in a holding pattern.
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.