North Gower Grains

Thursday was still another negative day for our markets.  Harvest corn closed down 8, harvest soybeans closed down 25 3/4, harvest winter wheat closed down 5 1/2 and harvest spring wheat closed down 3 3/4.  In the overnight trade corn is negative, soybeans are mixed and the wheat sector is now on the positive side. Oil closed down $2.98 yesterday at $93.00 per barrel.  It is weaker again this morning with it now valued at $92.86 per barrel.  Our dollar has traded between a low of $0.719 US and a high of $0.721 US over the last 24 hours.  This morning it is right in the middle of the range with it currently valued at $0.720 US.

The recent negative trend continued yesterday with the soybean complex leading the way down.  After hitting a new high earlier this week soybean oil pulled back yesterday as it followed crude oil prices lower.  Managed money has to be liquidating their previous near record long position (looking for prices to go higher) and this is pushing our markets down faster and farther then normal supply / demand fundamentals would suggest.

Harvest corn prices have fallen about $0.60 per bushel since May 13^th.  They are closing in on new lows for the harvest contract.  With strong crops this year in South America and a good start to the growing season in the US the supply side of this market is starting to dominate.  If the US crop continues to receive favourable growing conditions this market will require some increased demand to drive prices higher. 

Both the corn and soybean markets are looking for China to step up and make some purchases.  Bullish news is needed for these markets and currently we are just receiving bearish news Harvest prices are still stronger this year then last year but just barely.  This is probably a great time to put in some target orders for a portion of your projected production for this year.  This is even more important if you have not already made some harvest contracts.  Give us a call anytime to discuss your farm marketing requirements.

On the wheat front there is some supportive news on the global side.  Spring plantings in Russia are at their slowest planting pace since 2018 due to moisture.  Chinese production is being hurt by excess moisture that has resulted in some wheat sprouting in the field.  If this becomes a bit more widespread China could possibly become an importer of milling wheat later this year.  We should note that China is the largest wheat producer in the world and is also the largest consumer of wheat.  They consume about 18% of the world wheat production. 

Friday’s thought: Be thankful for some of the struggles in your life.  Not only have they made you stronger but they have also taught you how to be brave during your darkest storms!

Geoffrey Guy | 613-880-2707