The Rural Voice, 1993-06, Page 19Back to Ontario for a moment,
industrial users have pretty much
covered their corn requirements for the
next two months and don't need to be
aggressive in covering in the remainder
of their needs. Right now, I think corn
will be carried over into the new crop.
SOYBEANS
Old crop soybean basis in Ontario
continues to strengthen due to a faltering
Canadian dollar as well as low supplies
in Ontario. Elevators are currently at
$1.30 over July futures, an increase of 10
cents this week alone and it doesn't
appear that basis will soften over the
next few weeks unless our dollar
appreciates.
New crop basis levels remain flat on
ideas that Ontario will grow 60 million
bushels of soybeans. Planting is going
well and by the time you read this, the
crop should all be in the ground. We
won't know until after all crops are
planted the actual acreage of each grain,
but the guesses favour heavy soybean
and lower corn plantings.
The last USDA report lowered 1993
ending stocks by 15 million bushels due
Grain Markets
to an increase in crush and exports. The
initial crop size for 1993 is projected at
2.045 billion bushels, down from 2.197
billion in 1992, and even with a
projected lowering of total use in the
coming year, ending stocks in 1994 are
estimated lower than 1993. This might
appear to be outright bullish, but we are
seeing an increase in oilseed production
in China and Canada. As well South
America can increase production very
quickly and will definitely be a factor on
the supply side.
My thoughts about new crop basis
levels haven't changed. If you have to
move soys right at harvest time, you may
want to lock in at least the basis well in
advance of the fall and keep an eye on
the weather in the early summer to direct
your pricing decisions.
FEED GRAINS
Feed grain prices have stabilized
from the lows of last month. Bids for
Ontario barley are in the $85 to $90
range with most producers still expecting
to get $100/mt. However, we'll have to
see a change in usage patterns if any
quantity is going to move at the higher
prices. Mixed grain is trading in the $95
to $100 area which is quite realistic
given the smaller supply. Ontario feed
oats are worth $100/mt while heavier
test weight oats are selling for $110/mt.
Western grain prices are holding
steady with feed wheat trading at about
$120/mt while western barley is selling
for $110 to $112. However, very little
western barley is being used.
It seems that spirits are a little better
now that planting has progressed well
even though prices are weak. There
certainly seems to be some optimism
regarding soybean futures prices if the
past few weeks' performance is any
indication. Both corn and soybean
futures will be affected by weather in
June and July even though the initial
production figures for 1993 are fairly
high. I think we should assume that
temperatures will be higher than last
year and that crops will mature normally.
Producers should plan accordingly and
market their grain in an orderly
fashion.0
Information supplied by Dave Gordon,
LAC, Inc., Hyde Park, 519-473-9333.
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JUNE 1993 15