By Scott Scheils
As we roll into summer, everyone should be looking to market the last of the old crop, in order to make space for the (hopefully) large crop that will be coming off shortly! This can be a very trying time of year, as we often struggle to find homes for everything. Because buyers also know that producers will be looking to make space, prices can be quite depressed in the summer months. Demand is also usually quite a bit slower throughout the summer, as the grain companies have also tried to have their coverage on ahead of time, so bids can be hard to come by.
Long story short … more often than not, it is in the producer’s best interest to have most, if not all, of their grain marketed ahead of time. Of course, there is an exception to this rule that occurs when crop conditions in the field are less than favorable. If we are excessively wet or dry in the summer, and the crop is suffering, we have experienced situations where the market gets bullish (strengthens) for the new crop coming, which can increase old crop prices as well. Being diligent and staying in touch with a variety of buyers, in a number of different regions, will keep you on top of where these markets might be heading, allowing you to take advantage of the situation, in turn maximizing your returns.
Oat markets were quite flat going into the summer, with millers still basking in the glow of one of the best-quality oat crops ever produced on the Prairies. While the yields may not have been bumpers, the quality made up for much of that, keeping everyone quite full and the markets quiet. Seeded acreage this spring was basically even with last year, according to industry estimates, so with an average to above-average crop this fall, we won’t see any upward movement in prices.
Last estimates on canola had acreage down from last year, surprising most traders and a lot of farmers. Canola has consistently been one of the best return-per-acre crops on most Prairie farms, so in light of uncertainty surrounding our pulse and wheat markets, it would stand to reason that we would have been looking at more, not less, canola.
Wheat futures rallied back some in the spring, putting some support into that market, and leading producers to seed more wheat than was anticipated throughout the winter. Last year, we saw wheat prices heavily discounted due to low-protein levels in much of the hard red spring harvested in Western Canada. Hopefully, we will see better protein levels in the wheat this fall, as marketing opportunities are much better when we have a higher-protein wheat crop.
Pulse markets are still reeling from the tariffs put on by India, but acreage did not drop as much as most experts were estimating. Most of the industry was expecting a significant cut in acreage, but producers did, in my mind, the right thing, and didn’t cut the crops right out of their rotation. We have been seeing new market opportunities popping up for the past few months, and should the Indian tariffs become reduced or eliminated, there will be some great marketing options for producers that stayed the course and kept peas and lentils in their operation.
Until next time…