Bad harvest weather in Saskatchewan is helping oat prices, but few are predicting a shortage of quality oats.
“It’s too early to say,” said Dennis Galbraith, the manager of procurement for Can-Oat Milling in Portage la Prairie, Man.
“So far we’re only on the leading edge of the harvest.”
Feed grain prices in Western Canada and in the United States have fallen as big crops have come off the combine.
But oats prices, which tend to follow the corn market, have held up, rising slightly even as corn has fallen.
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Most analysts say this is due to the wet weather that stopped the Saskatchewan harvest. Some crop damage is expected but a panic has not set in among buyers.
“The delays are becoming a concern but are not critical,” said Ag Commodity Research oat market analyst Randy Strychar. “Should the harvest delays become more serious, we could see sharply higher prices. However, it is expected growers will sell cash off the combine.”
Strychar said farmers’ collective behaviour will set the nearby price tone.
“How much will be sold at or below current bid levels? This has been, and remains, the key to price direction in the oat market. Corn prices have likely done all the damage they’re going to, to the oat market. So at (this) point, growers are in large part in control of the market,” said Strychar.
Galbraith said rain delays at harvest can ruin a crop, but he doubted that has happened to this year’s crop.
“The bulk of the Saskatchewan crop wasn’t really mature coming into this rain, so I’m thinking that it will have suffered less damage than the wheat and barley crop, which was very mature,” said Galbraith.
Some malting companies have become worried because of sprouting in standing barley crops. But sprouting only occurs in crops that have matured and dried, so the generally late oats crops may be delayed but are much less likely to sprout.
In the spring farmers complained about late seeding, but in retrospect that delay may be a blessing.
“As it turns out, with the wet weather, that (late seeding) has been a good thing,” said Galbraith.
“A fully mature, dead ripe crop will suffer a lot more at harvest time than a green, immature crop.”
Farmers in the Red River Valley have been less fortunate, with extensive flooding preventing many fields from being seeded and ruining other crops. But a few crops have managed to make it to maturity and aren’t a disaster.
“Surprisingly we’re getting some workable fields out of the Red River Valley. Those guys who had forward contracts will be able to fill them,” said Galbraith.
