The Rural Voice, 1996-11, Page 19corn prices and the fact that much of
the western Canadian crop was hit by
snowfalls and wet weather. New crop
western barley is now arriving in
Ontario and is still selling for about
$175/mt. Western feed wheat is
trading for more than $200/mt and, as
you can see, isn't as competitive to
corn as it was only three months ago.
In Ontario, barley and mixed grain
prices are both in the $160-$170
range. Producers will need to target
specific users if they expect to
receive prices that are a premium to
com.
It's obvious that most observers
who were bullish on grain prices are
now taking some heat. Many thought
corn futures would hold $3/bu and
soybeans would stay well above $7.
We all tend to forget, however, that
prices can, and will, fall for reasons
that we may not understand locally.
I've always maintained that
fundamentals determine a general
range of futures prices. After this
price is attained, speculators and
technical traders tend to dominate
trading. Last summer, fundamentals
didn't push com futures over $5,
speculation did. Speculators are the
ones who tend to push prices too far
one way or the other and provide
opportunities for both producers and
feeders. The drop in corn and
soybean prices that we've seen since
the beginning of October may be
speculative in nature, but we won't
know until sometime in the future.
Personally, I think prices will react
because of the fact that world demand
for grains is still strong and producers
will have opportunities to sell at
higher prices. Today's prices are
providing feeders with an opportunity
to lock in some purchases. Timing is
going to be very important.°
Information supplied by Dave Gordon,
LAC, Inc., Ilyde Park, 419-473-9333.
'I'd bet my
hide on their
classified'
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NOVEMBER 1996 15