By Scott Shiels
Well, another harvest has come and gone, at least for the most part. Through the latter part of the summer, and into the early part of fall, we saw analysts and consultants calling for “bumper” and record crops projected to be harvested across the Prairies, pushing markets lower as farmers started to take off their crops.
There always seems to be a danger in these early projections, in that one or two weeks of adverse conditions, much like we saw this year, can dramatically affect the crop yield, and therefore totally render these reports irrelevant. This year, much of the Prairies experienced very hot and dry weather throughout the last week of July and first week of August. These hot and dry conditions took many fields that were poised to possibly be a bumper crop to much more average yields.
From a marketing perspective, these early and sometimes misleading crop reports need to be taken with a grain of salt. I realize that a drop in price is never a good thing, but the panic selling that occurs on these drops only serves to perpetuate the issue and further pressure prices lower. Nobody knows the conditions that you have on your land better than you do, so it is imperative that you consider your situation when you take in the barrage of information that comes at you during the growing season.
In this age of technology and information sharing that we live in, being able to discern which information is based in fact, and which is based in opinion, can be a very daunting task. Weather models vary from source to source, as do crop condition and yield reports. Provincial governments across the Prairies publish weekly reports on progress and crop conditions, based on information that they gather from their extension specialists located across those provinces. We take these reports, along with independent analysts reports and try and put out the most accurate market information that we can to you, our farmer customers. Of course, even with all of the most up to date weather and market information, one can never know for sure where prices will head on any given day.
What we do know is that supply and demand hold the key to cash pricing at the farm gate at the end of the day. This crop delivered average to slightly above average yields overall on the cereal crops, with excellent quality for the most part. For the oilseeds, especially canola, there was definitely more surprises on the disappointing side this year than the other way around.
All of these factors should be leading us into the winter expecting higher canola prices, but flat-to-soft prices on wheat, barley, and oats. Of course, another winter of “COVID demand” could boost prices in the cereals as well, but let’s hope that we don’t have to lockdown again to find better returns on our grain in the bins. While I realize that grain has to be sold to pay the bills, I strongly feel that patience will be more valuable than ever when marketing this year’s crop.
Until next time…
