[Farmmarketnews] Rod Crinklaw Grain Commentary

[Farm Market News - Ontario Commodity Report]

Wednesday 2 March 2011

Commodity
Period
Price  
Weekly Movement

Corn CBOT
May. 
7.23 ¼ 
↑
21   
cents

Soybeans CBOT
May.
13.93 ¼
↑
61 ¾  
cents

Wheat CBOT
May. 
8.10
↑
11 ¾  
cents

Wheat Minn.
May. 
9.40 ½  
↑
21      
cents

Wheat Kansas
May. 
9.09 
↑
18 ¾   
cents

 
 
 
 
 
 

Canadian $
Mar. 
1.0296
↑
198 
points

 
CORN
 
Corn values traded erratically this week showing signs of strength due to first
of the month fund buying and then weakness due to a technical selloff triggered
after prices reached a 32 month high on Tuesday night.  The debate continues as
to how tight the old crop corn situation is and whether supplies will hold up
through the summer. The USDA is now surveying for the March 31 prospective
plantings report which will set the tone for the upcoming crop.
 
The wheat-corn spread has collapsed considerably in the last couple weeks as
the corn market continues to trend upward and the wheat market has moved
sideways since the big decline on Feb 22.  This smaller spread will make wheat
more attractive as a feed ingredient and could find it displacing corn in some
rations.
 
SOYBEANS
 
Soybeans posted strong gains this week as talk of flooding in Brazil and
possible harvest delays there hit the newswire.  Some estimate that the harvest
in Brazil is now approximately 20% complete compared to a normal year where 33%
would be off.
 
The trade is now balancing crop expectations in South America versus new crop
US planting intentions to determine how tight stocks will be.  The USDA
prospective plantings report due out March 31 will be crucial to the soybean
market going forward.  Leading up to that report there will be much speculation
and positioning in anticipation of the actual estimates.
 
WHEAT
Wheat markets moved in a slightly upward to sideways trend since last week and
in doing so narrowed the corn-wheat spread considerably.  This may lead to more
wheat finding its way into feed rations due to its affordability versus corn. 
Middle Eastern countries continued to buy US wheat as a Saudi purchase was
announced.  Larger world wheat prospects on better weather in China and Pakistan
announcing they would export more wheat this year was countered by dismal crop
ratings out of the US Hard Red Winter producing states.  
Ontario basis values mostly improved as traders rolled off the March option to
the May last week, but a strengthening Canadian dollar has eroded away some of
the visible appreciation on the cash market.
Current contract prices for March 2, 2011 at the close are as follows:
SWW at $259.54 per tonne ($7.06 /bu.), SRW at $259.54 per tonne ($7.06 /bu.),
HRW at $277.41 per tonne ($7.55 /bu.), and HRS at $320.74 per tonne ($8.73
/bu.).
John Jordan
Editor, AgriLink and Farm Market News
University of Guelph, Ridgetown Campus
Tel. 519-674-1500 x 63577

Fax. 519-674-1530
E-mail: jjordan at ridgetownc.uoguelph.ca 
AgriLink website : www.ridgetownc.com/agrilink 
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