GrainsWest winter 2016 - page 11

Rain showed up just in time for some producers, salvaging what had been a very dry crop, while others received toomuch rain during harvest, downgrading quality.
Photo: Michael Interisano
The rest of May through August was dry.
“We got maybe one- or two-tenths of rain
here and there but it didn’t do a lot,” he
said. “The end of June and early July is a
critical time for moisture for cereals and
we were very dry. There were some later
showers that helped the canola, but any
moisture we got after mid-July didn’t help
the wheat.”
Some showers did show up in early
September to interrupt harvest. With
the risk of rain, and wheat that had very
weak straw, Heck decided to combine
and dry the wheat before the standing
crop went down.
“Overall, we were disappointed with
the wheat crop,” he said. “Wheat was
below average but the canola was surpris-
ing, as it came in at about average. We
were dry here but it was quite variable.
Some areas in the Peace had one inch of
rain, and then you went three miles away
and they had 4.5 inches. We were luckier
than some.”
Yields just below or near average reflect
the mood of commodity markets heading
into winter, said Neil Blue, an Alberta
Agriculture and Forestry market analyst
based in Vermillion. There doesn’t appear
to be any dramatic news one way or the
other Blue said, as he looked at late-fall
supplies and price outlooks.
“Wheat right now, for example, is pretty
flat in terms of price,” Blue said. “Wheat is
obviously a commodity on the world mar-
ket and the world was pretty well supplied
with wheat this fall. We are seeing a lot of
different grades out there, which will fit
in a range of markets, and really that is a
good thing.”
While in the coming months there
could be some weather-related rumours or
developing issues affecting wheat pro-
duction, which could affect prices, Blue
said, “Overall, at the moment I don’t see
anything that is really going to push the
market in any particular direction. Prices
are pretty flat right now, and I would say
it is a good time for producers to watch
for basis opportunities as well as forward
pricing opportunities to capture some
carrying charge in the market.”
Looking at feed grains, such as barley,
he said there were no strong signals for
price change in late fall. Calf prices had
dropped, and feeder margins were tight
or negative, and that could weigh on
feed grain prices. However, feeder cattle
exports to the U.S. (as of late November)
are 25 per cent lower than last year,
implying more cattle to be fed here in
Alberta this winter. Also, with limited
supplies of hay this year, producers could
be using more grain to feed with straw
as an alternative wintering ration. Blue
expects feed grain prices to slowly
improve during the winter, but the
degree of that improvement will depend
on winter weather.
Similarly, he didn’t see anything major
on the horizon with canola prices heading
into 2016. Canadian and world production
of canola was down in 2015. However,
there is increased crush capacity in Can-
ada and overall supplies are fairly tight. “I
don’t see anything crazy happening with
canola prices, but again it is a good time
for producers to watch for basis opportu-
nities when marketing.”
Blue said field pea prices, particularly
yellow peas, have been a shining star, with
late-2015 prices as high as $10.50/bu,
and forward contract prices for next
September of $9/bu. The main driver has
been demand from India, which is still
overly dry in some production areas after
two seasons of below-average yields. Len-
til prices are also very good, with current
prices of 40 to 50 cents per pound and
new crop bids of 30 to 36 cents per pound
for most types.
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