The Rural Voice, 1989-10, Page 22DK397
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(519) 352-5310
20 THE RURAL VOICE
GRAIN MARKETS
Grain markets have been relative-
ly bearish over the past two months.
Prior to the August USDA report, new
lows were established in both new -
crop soys and corn. But the report
showed production to be slightly
lower than industry projections and
markets rebounded quickly. The past
30 days have seen markets drift lower,
and barely holding above the contract
low.
CORN
The USDA report for corn showed
a slightly higher corn production
figure than traders expected. How-
ever, good early harvest weather and a
lack of demand news had a greater
impact on lower corn values than the
report did.
Basis levels at the elevators for
new -crop corn have remained steady
at .40 over December futures. Some
new -crop corn has already been har-
vested to catch some old -crop premi-
ums. However, at this point the
amounts have been fairly small and
there has been more emphasis by
producers on getting rid of old -crop
corn.
I expect that the futures market
will eventually drop to contract lows
of around $2.18/bu (December) before
stabilizing and trading in a sideways
motion.
The Ontario crop size has been
pegged at 166 million bushels, which
This information is taken from
reliable sources, but accuracy
and completeness are not guar-
anteed. Dave Gordon is a grain
merchandiser with London
Agricultural Commodities,
Inc. in Hyde Park, Ont., 519-
473-9333 or 1-800-265-1885.
is 20 million more than in 1988. My
feeling is that basis levels will remain
steady, with a possibility of some
improvement during the first part of
harvest. On-farm bids for new -crop
corn are in the range of .55 over
December futures.
SOYBEANS
The soybean futures market fell
to contract lows in mid-August just
prior to the August USDA production
report. But a lower than expected
production figure caused the market to
rebound back up around the $6.00
level. The September production
figure however, was neutral, and with
no new demand news the market has
dropped back to contract lows.
The market appears to have more
downside potential before it will turn
around. Generally, I expect there will
be pressure on the soybean market
throughout harvest in regard to both
basis and futures prices. With the
Canadian dollar holding its recent
strength and futures prices being low,
basis will be hard-pressed to improve.
Overall, the soybean crop looks
average with very few areas showing
extremes, while the corn crop has
some large deficit areas, especially in
the Niagara peninsula.
FEED GRAINS
Feed grains prices have been
showing a great deal of variation over