Nothing in Statistics Canada’s March 31 grain stocks report changed analysts’ vision of where markets are heading.
“My whole view of these grains is they’ve bottomed. They’ll take their turns gradually starting to work higher. Some will go more quickly than others but we’ve bottomed,” said Errol Anderson, analyst with ProMarket Wire.
Total wheat stocks of 15.5 million tonnes were about one million tonnes lower than what traders expected.
“The wheat number was definitely supportive to the market,” said Anderson.
Oat supplies of 2.5 million tonnes were also seen as friendly. Buyers will be looking for oats from mid-summer on to feed the Minneapolis market, he said.
Read Also
Increasing farmland prices blamed on investors
a major tax and financial services firm says investors are driving up the value of farmland, preventing young farmers from entering the business. Robert Andjelic said that is bullshit.
Canola stocks were up 28 percent over last year at a record 5.9 million tonnes but that was expected. In fact, traders thought supplies on hand would be slightly higher.
“The barley number is the only one that is a little bit disappointing,” said Anderson.
At more than six million tonnes, it was about 400,000 tonnes more than the trade anticipated. But Anderson believes rising corn prices will eventually support barley.
Stat Publishing editor Brian Clancey isn’t concerned about the record 1.67 million tonnes of peas on hand because it is about 200,000 tonnes lower than anyone could have imagined a few months ago.
If exports match the five-year average over the remaining third of the marketing year, there would be 780,800 tonnes of pea carryout on July 31.
Clancey is sticking with the 650,000 tonne number he has penciled into his supply and demand charts.
“The feeling you get right now is that there is nothing available. You know it’s there but it’s hard to buy,” he said.
Lentil stocks are estimated at 197,000 tonnes, 40 percent below last year’s level and well below the five-year average of 460,000 tonnes.
“There is definitely confirmation in (the report) that lentil stocks have been flowing out of the country at a torrid rate,” said Clancey.
A record 768,500 tonnes or 80 percent of available lentil supply has been exported or consumed during the first eight months of the 2008-09 marketing campaign.
If disappearance continues at its five-year average pace, there would be a lentil deficit, which is why the market has been so hot of late in an attempt to ration demand.
“The message farmers should get from that is this is a very clear marketing opportunity for what is remaining in your bins,” said Clancey.
“I think it is critical to make sure you take the profit this year. Don’t carry that (supply) into new crop.”
Demand remains strong into the opening shipping positions for new crop lentils.
“There could be a lot of logistical problems in the fall and there could be a lot of technical pricing as a result,” he said.
In other words, any crop that is ready to be sold and moved when the exporters need it could fetch a premium just for being in the right place at the right time.
Movement of chickpeas has been pathetic. During the first eight months of the marketing year, 38 percent of the available product was moved. But few people really care about the 107,000 tonnes of stocks on hand because farmers have locked the bins so it is a meaningless number.
“In both canaryseed and chickpeas, farmers will determine the fate of the market,” said Clancey.
