- StatsCan figures, released today, confirmed expectations of a bumper all wheat crop, set to be the best in 22 years as well as a record canola crop. Unfortunately the latter, whilst still a record, is well below market expectation and left prices in both Canada and the corresponding Paris rapeseed market trading higher. Wheat was forecast at 30.56 million mt, which is close to 13% ahead of last year’s crop and also ahead of trade expectation of 30.4 million mt and the ministry figure of 29.2 million mt. Gains in both acreage and yield were reported to have contributed to the harvest number.
- The canola forecast at 14.74 million mt, was reported to be above ministry expectations and ahead of the previous record of 14.61 million mt set a couple of years ago. Whilst harvested acres are set to reduce, it is the jump in yield of some 22% which is responsible for the gains. Despite the forecast, trade expectation was for a higher figure of 15.5 million mt and the latest USDA forecast of 15.3 million mt, hence the uplift in prices following release of the figures.
- The ongoing Pro Farmer crop tour has reported from Nebraska, the US’s third largest corn producer, with estimated yields of 154.9 bu/acre. Whilst this is an increase over last year’s drought hit crop, it is only slightly above the three-year average of 147.9 bu/acre. The crop is understandably delayed in its development as a result of planting delays, but forthcoming warmer conditions will help the crop to advance.
- The tour reported soybean pod counts below the three-year average once again on account of delays in planting and cooler conditions. Their figure of 1,139 pods (in a 3 foot by 3 foot plot) fell marginally short of the 1,162 pod count average. The tour is scheduled to release its overall conclusions on Friday.
- SovEcon today reported potentially reduced grain exports from Russia in September following a busy July and August. High prices and questions over volume stocks of quality wheat are reported to be responsible for lower demand from key buyers. More attractive supplies and prices from the likes of Australia, Canada and the US as well as offers of lower grade material from Ukraine all contribute to the pressures on Russian supplies.
- Prices in Chicago have once again risen as concerns continue to exist over warm and dry weather conditions in the Central US. Harvest is some six weeks from commencement and with it will come harvest pressure, potentially relieving the high old crop cash premiums which have featured in recent months. One further factor will be the need for US prices to compete with (currently) better priced supplies from S America and Ukraine. (Ukraine corn remains $10-15 below Brazil, and $20-25 under US). Failure to compete will likely result in lower export volumes and consequent higher end stocks. Clearly the road for higher US prices appears to be fraught with issues which will materialise from outside the US.