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The Rural Voice, 1990-10, Page 20Get the Heat with 0% Financing* Maximire the economies of propane with the advanced technology of a GlowCore "Unicore Integrated Heating System". Propane space heating and water heating arc combined into a unified, highly efficient home comfort system that uses hydronic or forced air. And with Superior Propane's financing you pay absolutely no interest for one year. Or choose a term of up to five years, at competitive financing. Minimum of 10% down payment required. Come today to your local Superior Propane Branch and ask for full details. Offer expires November 30, 1990. •Nnding credit approval. Superior Walkerton Hwy. 9 W. 519-881-1270 Stratford 519-271-0810 1-800-265-4915, All models may not bb avallable at all Branches. While supplies last. Models shown may contain options That areavailable at extra cost. Owen Sound Hwy. 70 519-376-6735 Goderich 519-524-2661 16 THE RURAL VOICE GRAIN MARKETS QUICK CHANGES! From tight stocks to lower usage to higher production to frost scares to plenty of rain to embargoes, grain prices have fallen steadily over the past two weeks As the price of one grain falls, others fall in a domino effect. For instance, an excellent North American wheat crop followed by the embargo on exports to Iraq, has priced wheat into many feed rations and replaced corn. CORN Corn futures have acted in an absolutely pathetic manner. Both fundamentalists and technical traders have been and still are negative given the last USDA production report which showed corn production over 8.1 billion bushels. (Surprise!) This figure may be a little optimistic but corn exports will likely slip as well this coming year because of the other cheap feed grains around the world and the fact that Russia is still projected to harvest much better than normal crops. When we talk about cheap grains, I mean CHEAP. For instance, wheat selling FOB Europe at $67 U.S. per tonne or FOB ports in Canada at $87 Can. per tonne is cheap. The positive side of corn relates to con- tinuing good feed usage in North America and, with higher oil and gas prices, the poten- tial of more corn being used for fuel alcohol. As well, low corn prices will likely encourage U.S. farmers to put their crop into the reserve program thereby keeping it off the cash mar- ket until late in 1991. Some market prognosticators are pre- dicting corn futures will drop under $2. My own feeling is the futures will drop but, I doubt if the market wiil get below $2.10/bu. In Ontario, the basis for old crop corn has held steady as of this writing but, all buyers are anxiously awaiting corn harvest to begin. Any amount of new crop corn on the market will certainly erode the basis quickly so, if you have any corn to offer, get rid of it promptly. New crop basis has softened due to the fact that the Ontario crop is larger than last year and with the Canadian dollar holding fairly strong, excess corn may have to be exported. In reality, only Iran and Cuba are likely to buy any Ontario corn this fall and they certainly won't provide a premium market. In fact, I feel basis levels will be pressured throughout harvest at least until the crop gets under cover. Atter harvest, I think basis will remain flat for several weeks while the futures may show some strength. Current (September 21) basis levels for old crop corn range from $1.00 to $1.10 over December futures with off -farm bids currently at $1.20 to $1.25 over December futures. New crop basis levels are currently sitting at 25 cents to 30 cents over December futures. If you need to sell corn in the middle of harvest, consider replacing the sale with a July call option. SOPS Soybean futures haven't fallen quite as hard as corn futures even though the bean market is at its near term low. At the current bean to corn ratio, U.S. producers may sell soybeans instead of corn, and, given the perception that South America will grow fewer soybeans this year, soybean futures could hold steady through harvest. Soymeal and soy -oil demand has re- mained quite strong and usage should hold at present levels in the coming year. In Ontario, producers may be disap- pointed with yields this year. Even though the crop looks good, mold has appeared in many fields and frost in many areas this week came too early for the majority of the crop. We will likely see immature beans and light test weights when harvest begins. Basis levels have fluctuated with the rise and fall in the Canadian dollar. After the Ontario election, the value of the Canadian dollar fell substantially while at the same time the soybean basis improved. Crushers have only one bid for soybeans now and that is a new crop price irrespective of the status of the beans being offered. Basis levels at elevators range from .35 to 40 cents over November futures, with off farm bids at 50 to .55 cents. Certainly for cash flow purposes, a soy- bean price of $6.50 to $6.80/bu is more attrac- tive than corn in the $2.50/bu area. FEED GRAINS A large supply of feed grains both in Ontario and Western Canada has led to much lower prices for oats, barley, and mixed grain. These lower prices will have an effect on corn prices (or is it vice versa) this fall. Ontario feed oats are trading between $70 to $75/mt while barley and mixed grain are selling in the $75 to $85/mt range and plenty of grain is being offered. As you can see, the grain markets are generally depressed and depressing. How- ever, in the longer term, these low prices should stimulate demand. I was a little too op- timistic during the summer concerning grain prices and have had to eat crow. Maybe, just maybe, my vision for higher future prices will turn into reality after the crops are harvested.0 Information supplied by Dave Gordon, London Agricultural Commodities, Inc. in Hyde Park, 519-473-9333.