[Farmmarketnews] Ahmed Chilmeran Grain Commentary

[Farm Market News - Ontario Commodity Report]

Wednesday October 12, 2011
 
Commodity markets fared better after Jose Manuel Barroso, the president of the
EU commission indicated that he would put forward a proposal on Wednesday in
front of lawmakers in the European Parliament designed to strengthen weak banks
and tackle Greece’s debt burden. The plan will focus on greater economic
integration and support for the European financial stability facility (EFSF),
EU’s temporary bailout fund. The news spill over left the Canadian dollar up
over its American counterpart by over a cent to $0.984 US.
   
CORN

Corn futures rose after Russia said it could reintroduce a grain export limit.
The news came just three months after Russia lifted an earlier export ban. On
the other hand, the USDA’s monthly crop report estimates point to a smaller corn
crop but bigger 2012 supplies.  US forecasts were slashed for the third straight
month, but still increased their supply outlook because of carryover from last
year's harvest. According to the USDA, farmers will produce 12.433 billion
bushels of corn this year, down from the 12.497 billion bushels the government
predicted a month ago. The harvest will still be large by historical standards
but down slightly from last year. 

SOYBEANS

USDA’s estimates for soybean production are forecast at 3.06 billion bushels,
down 1% from September and down 7.3% from last year. Yields are expected to
average 41.5 bushels per acre, down 0.3 bushel from last month and down 2
bushels from last year. The yield forecast is for the second-lowest yield since
2003. Morgan Stanley expects soybeans to average $14.25 a bushel in the 12
months ending August 31, 21% more than yesterday’s closing price of $11.775. 
 
WHEAT

Wheat prices initially rose by more than 8% on Tuesday after Russia announced
it could reintroduce a cap on grain exports. However, wheat tumbled on Wednesday
after the USDA’s estimates boosted global stockpiles, indicating more supplies
for food makers, animal feed and ethanol. US wheat futures fell 5% on Wednesday
amid speculation that wheat world supplies may total 202.37 million metric tons
before next year’s harvest. According to the USDA, this is more than analysts
anticipated and the most since 2002.
 
 
Harvest contract prices for October 12, 2011 at close, are as follows:
SWW at $213.68 per tonne ($5.82 /bu.), SRW at $213.68 per tonne ($5.82 /bu.),
HRW at $245.44 per tonne ($6.68 /bu.), and HRS at $323.73 per tonne ($8.81
/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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