Time to exercise patience says analyst

LANGHAM, Sask. — Now is not the time to be pricing new crop, says a
markets analyst.

“I don’t want to be selling a darn thing right now,” said Mike
Jubinville, analyst with ProFarmer Canada.

“Right now is one of those times you just sit on your hands and you
wait.”

Grain markets have taken a significant downturn in the last month or so
due to uncertainty caused by escalating trade tensions between the
United States and some of its major trade partners.

“Uncertainty breeds fear and fear breeds selling,” he told attendees of
the 2018 Ag in Motion conference.

More Ag in Motion 2018 coverage here.

But market fundamentals suggest grain prices should be higher and it’s
only a matter of time before the market figures that out.

Commodity markets in general have come off their 2016 lows and have been
trending higher until tariff wars suddenly erupted.

Jubinville said corn ending stocks are forecast to decline in the U.S.
and globally this year. The December futures contract had been trending
higher until it took a significant downturn in June.

He isn’t forecasting a bull run but some correction to the upside is
warranted.

Bruce Burnett, director of markets and weather with Glacier MarketsFarm,
provided a province-by-province update on the development of Western
Canada’s crop.

Manitoba’s crop is further ahead of the other two provinces but yield
potential is less than last year due in part to the condensed growing
season.

Wheat heads are 15 to 20 percent shorter than they were last year, while
corn and soybean crops are in desperate need of rain.

Saskatchewan’s crop is more of a mixed bag than any other province. In
the south and central areas crops are extremely stressed. While the
north had some of the best crops on Burnett’s tour.

Alberta’s crop is developing at a normal pace. Crop establishment was
good in the south but crops are experiencing heat stress. There is a
considerable turnaround in crop fortunes anywhere north of Red Deer.

Overall, Burnett is forecasting average canola yields of 40 bushels per
acre, durum yields of 34.5 bu. and spring wheat at 48 bu. Not as good as
last year but still pretty decent.

Contact sean.pratt@producer.com

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