The Rural Voice, 1992-04, Page 23GRAIN MARKETS
With a large portion of the Ontario crop
needing to be shipped by mid-July to
make space for the large wheat crop, an
opportunity might still exist to export
more corn if basis weakens here or
export bids improve.
As a point of interest, Ontario
shippers to the New England market
are finding competition from Quebec
exporters who are able to undercut our
prices substantially due to heavy produ-
cer selling in Quebec. In all likelihood,
users in Quebec will need to import
product to replace some of their ex-
ports, which should result in some re -
strengthening of the Ontario rail basis.
Today, basis levels in Ontario range
from 10 cents over May futures in the
area north of London to 15 cents over
May futures in the southwest. By the
end of January 40 per cent of the 1991
com crop had been sold by producers
and had all been used. Industrial users
have been processing heavily and
moved their basis levels higher to
reflect their demand for corn and I
expect their requirements are going to
remain high for the balance of the crop
year. Feed users, on the other hand,
have had a steady to lower demand.
Corn futures prices strengthened
over the last month followed by a
settling back in recent days. It will take
more exports to make old crop future
prices move much higher and weather
problems to make new crop futures
strengthen. As I've said before,
producers have to keep abreast of these •
fundamentals.
SOYBEANS
Last month, I said that soybean
futures could be under extreme pressure
because of the large South American
crop. But, with strong wheat markets,
soybean prices stayed relatively strong
and then the Brazilian government
issued storage advances to producers,
enabling them to hold their soys off the
markets. As a result, we may not see a
flood of South American soybeans
dumped on the market.
The last USDA reports left carry-
over stocks unchanged for both soy-
beans and soymeal but did drop the
soyoil stocks. However, with the very
good crush and the demand for soymeal
from the Eastern bloc, we could easily
see higher usage in future reports.
Sparks also released a projected
APRIL 1992 19
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APRIL 1992 19