Farm Business Communications is starting off the new year with a new daily grain marketing commentary for our Alberta Farmer, Grainews, Manitoba Co-operator and Country Guide West websites. It’s prepared by Brian Wittal, who has spent more than 27 years in the grain industry, including as an elevator manager and producer services representative for Alberta Wheat Pool, regional sales manager for AgPro Grain, and farm business representative for the Canadian Wheat Board, where he helped design some of the new pricing programs. He also operates his own company providing marketing and risk management advice for Prairie grain producers. Brian’s daily commentaries focus on how domestic and world market conditions affect you directly as a grain producers. He welcomes feedback and information on market conditions in your area.
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January 6 — Markets were up strong today as exporters were buying and speculative fund buyers decided to get back into the game of trading commodities. The continued talk of weather concerns in South America has the funds thinking it’s time to get back in the game and they pushed futures values up across the board.
This may offer some additional momentum to the markets but a change in weather could derail this rally real fast and there are calls for showers later this week in some of the drier regions in South America.
Farmers are also holding off selling much right now and this is also helping support prices as grain companies need stocks to fill sales, so all they can do is push prices up slowly until producers start selling. It’s a waiting game to see who can hold out the longest.
March canola futures were up $11 per tonne to close at $439.30 per tonne.
November 2009 was up $12 per tonne to close at $469 per tonne.
Western barley futures were only up $2 to $3 per tonne.
Minneapolis wheat futures were up 27 to 30 cents per bushel.
Having the funds back in the trading game brings a whole new perspective to the grain markets yet again as we know what can happen in a weather rally. It usually overreacts and then overcorrects.
Feed the frenzy; it’s easier to sell into a rally then to try to sell coming out of a rally.
That’s it for today, we’ll be back with more market intel tomorrow. — Brian
