Friday the 13thy

I’m feeling all Friday the 13thy – a little antsy, a smidge dreadful, a touch anxious. It’s that irrational feeling that hits me on Fridays the 13th regardless of the fact that I, like any reasonable person, doesn’t really believe that calamities are any more likely on Friday the 13th than on any other day. And I don’t believe in luck, except when other people succeed and I don’t . . .

Perhaps I’m feeling drawn down by the grey, grim skies and late-fall weather that’s hanging over downtown Winnipeg like the smell of a rotten pumpkin stinking up the porch. Or perhaps it’s a lingering effect of the sickness I suffered from Thursday to Wednesday, which had me fevery, achy, complainy and whiny. Even more complainy and whiny than usual.

Or maybe it’s the release of that new apocalyptic film 2012, which is enticing the morbid with visions of global destruction and civilization collapse.

Or perhaps it’s the state of the markets for crops, which is the purpose of this blog post. For the past days the main crop markets have been stumbling along anxiously, as if not sure which way to go, and as if scared of a fright to come. Earlier today I was speaking to a couple of American crop market analysts and trying to get a grip on the question of whether the crop commodity markets feel bullish or bearish. They both said the same things that the charts are saying: it’s hard to tell. There are bearish factors out there. There are bullish factors. Altogether, it feels a bit unpleasant and unsettling.

Here’s what it looks like on the charts for a couple of the biggies:

Everything’s gone all flat, but not in a comforting, relaxing way. We’re still pretty close to the harvest lows and it’d be nice for anyone with crop to be able to reasonably believe that those are lows that will hold. Will they?

Right now most analysts are swinging their creaky old wooden chairs around, putting their backs to the North American supply questions that have occupied them for months and looking instead more closely at demand. Will demand hold? Is it going to increase if the economy continues to (statistically) rebound? Is there enough demand out there right now to eat up the giant cereal grain crops that the northern hemisphere produced this year?

The way that the “analyst community” answers these questions will go a long way towards resolving which direction crop prices will move when they break out of this recent range. There’s a rather grim feeling around the Winnipeg grain trade these days, with flax exports caught in limbo, canola exports threatened and the never-ending woes of the hog industry spoiling any excitement at the beginning of the marketing year. A smart surge higher out of this present dreary range wouldn’t eliminate the commercial problems for flax, canola and hog exporters, but it would remove a lot of the pall and let people move forward with a greater sense of optimism.