The dry conditions of large parts of Alberta and western Saskatchewan have finally started to be noticed by traders at the major commodity exchanges.
But it seems to be bad all over.
It is also dry in Montana and western North Dakota and too wet in eastern North Dakota and parts of South Dakota as well as parts of Manitoba.
Only 53 percent of the United States spring wheat crop was in the ground as of May 14, compared to the five-year average of 62 percent.
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Feedgrain prices expected to plummet
A massive U.S. corn crop is keeping a lid on Canadian feed barley prices.
Some farmers there might start shifting from wheat to shorter-season crops.
A heat wave was expected to fry a big part of the U.S. winter wheat belt after the crop’s condition was slightly downgraded on May 14. That ended speculation that rain two weeks ago had improved crops.
It still hasn’t dried up in water-logged France and now it is getting dry in China’s northern plains.
In Western Australia, the drought that devastated crops last year has lingered and is threatening this year’s crop as it is being seeded.
All this contributed to heightened unease in Chicago, Kansas City, Minneapolis and Winnipeg early this week.
But the potential for a price breakout like in 1995-96 remains elusive. The production problems in the United States have so far been limited to wheat.
The U.S. Department of Agriculture forecasts the largest soy crop ever and the fourth largest corn crop.
There appears little likelihood of a turnaround in soybean prices, but corn has a little more potential.
Weak drought conditions have
begun to appear in southern
Missouri, Illinois and Indiana (see enso.unl.edu/monitor/monitor.html.)
The weather condition is too early and not bad enough to have much of an effect yet, but could if it lingers. The other factor needed to kick prices to substantially higher levels is good demand.
That is threatened by the continued strength of the American dollar and rising energy costs.
But there are hopes that global recession fears might fade in the second half of the year and wheat importing country currencies will rise against the greenback.
A new site
You might have noticed that we have changed one of the locations for U.S. cash prices for feeders. The North Dakota information is no longer available so we have switched to Sioux Falls, South Dakota.
