In most years at this time, the grain would be pouring into country elevators.
The Canadian Wheat Board would be getting a good sense of the type of crop that farmers had produced and would be able to begin making aggressive forward sales.
But this year, most country elevators are about as busy as smoke-free bingo halls and the wheat board has no idea what kind of a crop it will have to sell.
“We don’t know the job at hand yet because we still have a long way to go for harvest,” said the board’s chief executive officer, Adrian Measner.
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Agricore United spokesperson Radean Carter said her company is getting ready to deal with a crop that could be different from one area to the next.
If a lot of lower protein and lower grade wheats are produced, the company will try to find areas of high quality wheat to blend with them to increase the overall quality of the crop.
“That’s the advantage we have with geographic dispersion,” said Carter, whose company is Canada’s largest grain handler.
“If we have a poor grade in one area and we know we have some high grades in another area, we are able to do some mixing. That’ll help us out in meeting the needs of our end users.”
Frosts in August and wet, cool growing conditions have many observers expecting lower grade crops. The longer the crops stay in the field, the greater the chance that quality will suffer.
Measner said it might not be more difficult to market a mixed quality crop, because many buyers don’t want or aren’t willing to pay for top quality grain.
“Having a diversity of crops is not a bad thing, because we have a diversity of customers,” said Measner.
“We sell to over 200 customers. We sell to over 70 countries. We have the ability to react to changes in crop quality. … This year means we will probably be changing our customer profile somewhat.”
Carter said that having pockets of poorer quality crops may make some crop sales easier.
“For some products (buyers) don’t want the No. 1 grade, so you still have to blend it down,” said Carter.
“There certainly is going to be a certain amount of lower grade that is still good for various end users.”
What neither the wheat board nor AU wants to think about is the possibility of a wide scale weather problem that would cause major downgrading.
“The worst case scenario is that it all comes in as feed, but we don’t anticipate that happening,” said Carter.
Measner said this will not be a good year to sell feed grains on the world market.
“That will be a challenge in the export market given the size of the U.S. corn crop and barley crops around the world,” said Measner.
Even though little grain has been flowing to the elevators this harvest season, the wheat board is not yet having trouble fulfilling its supply contracts to buyers.
“We have sufficient carryover that has allowed us to service the contracts that we do have,” said Measner.
“There have been no vessel delays … I’m not anticipating that there will be any major issues.”
Carter said the condition of prairie crops may be better than expected.
“The cold and wet isn’t affecting quality so much, we’ve seen,” said Carter.
“It’s just delaying harvest at this point.”
