The Canadian Wheat Board sees nothing yet to significantly alter its 2005-06 wheat forecast.
“It does look pretty flat,” said wheat board grain marketer Dave Simonot.
On May 26, the wheat board Pool Return Outlook for 2005-06 reaffirmed the low prices for high grade wheats that have been depressing farmers as they seed.
All wheat grades were unchanged. Durum grades were bumped up $3 per tonne, while feed barley and malting barley were nudged up $1.
Simonot said the board has no reason to raise its wheat price expectation because no new major issues have arisen this year to change the supply-demand fundamentals. But he said there is time for weather and other conditions to affect crops and markets.
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“It’s still early, so I wouldn’t want to get too negative.”
Last year’s world crop of 620 million tonnes left the
major exporters with ample stocks, so wheat prices have been in a trough all winter. If another large world crop is produced – the wheat board is predicting this year’s to be 607-610 million tonnes – “it’ll probably add more to stocks,” he said.
“Looking forward, prices will probably stay pretty much the way they are.”
But prairie farmers might fare better in 2005-06. Last year, low world wheat prices were compounded by a low quality crop. A more normal quality crop this year should improve income, said Simonot.
“It’ll be No. 1 and 2 with protein rather than No. 3 and feed. That would be a better outcome for Western Canada.”
