The Rural Voice, 1993-04, Page 22IS YOUR FARM MACHINERY
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Robert McNaughton 527-1571
Don Taylor 482-9976
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John Wise 482-3401
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Cockwell Ins. Brokers 356-2216
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18 THE RURAL VOICE
Grain Markets
Slow demand, static
prices continue
The last 30 days have seen a
continuation of slow demand, weak
corn prices and static futures prices.
With all of the talk about the
quality of light -test -weight corn,
one would think demand would
increase. However, the supply of
low grade corn is far greater than
the demand. Soybean prices have
remained relatively strong with
good demand for the old crop.
CORN
Demand for com in Ontario
remains slow, in large part because
of cheap western feed wheat.
Prices of wheat continue to weaken.
Over past three months, mill feed
prices have been soft as well, thus
replacing corn. However, mill
feeds have started to strengthen in
price and should allow corn
demand to improve. In fact, the
discount for grade 5 corn has
narrowed slightly to about $26/mt,
but I don't think we'll see any more
improvement unless some
unforeseen demand comes into the
market. Basically speaking, the
lighter -test -weight corn is a very
good buy for feeders given the fact
that no toxins appear to be present.
Feeders have to be sure that rations
are balanced to make up for the
lower energy in the corn, but users
to this point have seen no apparent
problems in their feeding programs.
Basis levels in the U.S. are
gaining strength but this strength is
not apparent in Ontario. In fact,
there hasn't been any carry in basis
levels since harvest and this will
likely remain on into the spring.
With the huge supply of corn in
Ontario and the prospects of more
U.S. corn coming in to CASCO, I
see no reason for basis levels
improving.
SOYBEANS
Old -crop soybean basis levels
continue to hold quite firm due to
high crush levels. Soymeal usage
has been high because of higher
livestock numbers and also because
protein levels in corn are generally
lower. Along with good soymeal
demand, oil yields in soybeans are
lower than normal and as a result,
supply and demand for oil is
relatively in balance. In Ontario,
producer selling is slowing down
but approximately 85 per cent of
the 1992 crop is already sold. The
balance of the crop will likely be
held tightly by producers with the
result being a fairly large quantity
of imports. Old crop basis has held
steady, despite the rising Canadian
dollar, at $1.15 plus May futures at
elevators and $1.30 plus May
futures F.O.B. farm. However, new
crop basis levels have eroded with
the stronger Canadian dollar by
about 20 cents/bu. Elevator basis
sits at 95 cents to $1 over
November futures.
With strong North American
demand, low oil yields and the need
for extra protein in rations, futures
prices have remained quite stable
and many traders feel we may see
some strength into the spring.
Most likely, a large acreage of
soybeans will be planted in Ontario
this spring, but there should be op-
portunities to forward -contract
new -crop soys at profitable prices.
You may think that you've missed
the boat when basis levels were
higher but you should be able to
make up some of the difference
with higher futures prices. It would
be prudent to sell part of your 1993
production early rather than at
harvest.
FEEDGRAINS
Feedgrain prices have sagged
over the past month at a greater rate
than during the early winter period.
Western wheat and western barley
are both trading in the $113 to $115