Market Insights
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Market Mood
Overall Feel
Overall market mood is optimistic. Since last week’s USDA report the market responded in a very bullish fashion. Typically, this report sets a market tone for the next few months.
Horizon
Over yonder
· Everything is all about the Trump Presidential inauguration and what the means to Canada. Unfortunately, our politicians have made a complete mess of things over the last 9 years and now we are faced with the threat and real possibility of a 25% tariff on everything Canada exports to the USA. However, It seems as if a 25% tariff is more clickbait than reality.
· The reality is that we have no idea how this is going to affect Canadian agriculture. Most likely Canada will come out as the loser.
· Brazil is expecting record soybean production at 166.3 MMT which is up 19 MMT
· Brazil is also expecting a large corn harvest of 119.6 MMT up by 3%
· Luckily, wheat is projected to be down by 2.6% at 7.89 MMT
Quick Market Sentiment
short-term Market Feel ~ 10 days
Wheat | Canola | Barley |
Sideways --> Up Confidence: 60% | Sideways --> Up Confidence: 50% | Sideways --> Down Confidence: 80% |
What To Do
Now What? General Marketing Thoughts
Since this is a serious issue it is well advised that grain should be sold to a comfortable level. Meaning don’t have everything in the bin.
Canola -Technical Thoughts
Canola production in Canada is estimated to be 17.8 MMT. While 2025 has no official estimates, a 19-20 mmt crop should be expected.
Canola ending stock is projected to be down to 1.250 MMT.
3. Canadian production of renewable diesel is set to increase as plans are moving forward for a plant in British Columbia near Edmonton that will require 2.5 MMT of canola to feed the plant. This will require two to three new crush plants to supply the facility with canola oil. This is the equivalent of a unit train of canola oil every 3.5 days to meet the proposed plant’s needs.
Market Zoning:
Reasons for Concern: USA unpredictability
Reasons for Optimism: Low production and low ending stocks. Weak Canadian dollar
Overall Confidence in this Market:
High Confidence that this market will be range bound between 625-650. It may try to break up to 675.
My Farm – Canola
Greg, what’s your Point? How’s this going to help my farm?
Canola wants to rally up, However, it will take a push to do so. There is no point in selling anything less than 14 and it seems like 14.50 is a high. There is a slight possibility of 15 in the spring and summer.
Most farmers should be down to gambling stocks by now.
Future Planning:
New crop pricing should be considered if the futures hit 700. Then make a plan to capture that price.
Wheat -Technical Thoughts
1. Of all the Ag commodities out there, wheat has the most bullish fundamentals. World-ending stocks are expected to drop down to 258 MMT down from 267 last year,
2. Russia's wheat crop production dropped to 83 million tons in 2024 after sitting at 92.8 million tons in 2023 and a record 104.2 million tons in 2022
Market Zoning:
Reasons for Concern: Excellent winter crops
Reasons for Optimism: : Lots of countries have small production problems again.ah
Overall Confidence in this Market:
Wheat's strong fundamentals in which it will create a weak bull market.
My Farm – Wheat
Greg, what’s your Point? How’s this going to help my farm?
Wheat targets should be in place at current levels of 8.50 for HRS and 8 for CPS. A lot, of those targets have been hit already and now farmers are sitting comfortably with grain in the bin waiting for the next rally.
Future Planning:
Market could easily rally. Targets should be placed at 8.75 HRS and 8.25 CPS on 50% of THE remaining inventory. the wheat market could rally significantly in the coming months.
NEW Crop: Stand aside unless $9.00 HRS is achievable.
Corn / Barley -Technical Thoughts
1. Global corn ending stock has been steadily climbing.
2. The USA crop crop was smaller than expected
Market Zoning:
Reasons for Concern: Rally driven on hype and technicals, big South American crop.
Cattle coming into Canada is lower than normal.
Reasons for Optimism: Lower prices will reduce seeding acres.
Overall Confidence in this Market:
The Barley market at the cash level is very stable. The drop in the Canadian dollar has been attributed to much of the gains.
Corn is likely to shift into neutral and drift lower until an acreage battle starts up in the spring.
My Farm – Barley
Greg, what’s your Point? How’s this going to help my farm?
The barley market has been very stable over the last few months. The Spot current Barley price is 6.35 Delivered in Lethbridge. In May it is 6.64
Future Planning:
get down to gambling stocks with barley. Lack of demand will keep a lid on prices.
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