All Regions / What are the charts saying after this recent sell-off in the wheat futures? Are there are any fundamental changes behind the drop? Have you changed your strategy & targets now that we are seeing such a drop in values?
 
The wheat futures were overbought and funds are taking profits. That has started a more aggressive sell-off than we would have liked to see. Especially with no reversals happening on the charts ahead of the pressure. The fundamental picture hasn't changed. Global supply is still tightening and there are crop concerns for Russia, Ukraine, EU, and maybe elsewhere too come spring. The demand picture is still looking good too. The two negatives to consider are trade issues with US and a short-term rise in the USD. Otherwise, it's mostly a larger than expected profit taking by the funds causing all the pressure.
 
The only thing recommendation wise that's been weighing on me is maybe we should have sold more old crop on our rec in mid-Feb. But that's always the feeling looking back. New crop values weren't strong enough to make it work with the break-evens unless you had the $8.50/bu+ offers in AB. I am still confident the funds will look for new spots to buy back-in and then ride the futures back up to the last highs or the previously mentioned gaps. Use $6.55/bu, $6.85/bu, and $7.10/bu on Minneapolis wheat, $6.42/bu and $6.71/bu on Kansas wheat, and $6.20-6.50/bu on Chicago wheat for targets. Looking for a support hold within the next 7-14 days between where prices are now and .20-.30/bu lower in the worst case.
 
All Regions / What's the trend for canola futures and the plan for next old & new crop sales?
 
Canola futures are under some pressure after failing to get past the $686/T resistance on the May contract. We saw prices climb back closer to that level on Thursday but failed to hold the strength into the close. The first support to hold on this pullback is $640-650/T. The market will likely be oversold in the next 7-10 days. Then I would look for a return to $675-686/T at a minimum. We might sell a percentage at that price but I'm also still confident the gaps at $700-710/T can be filled. So I will be holding some old crop back for that event.
 
The November contract supports are $640/T and $630/T. We are using $665-675/T as a target range for some more new sales and a move above $675/T can extend the uptrend further. That happening might depend on the old crop chart gaps being filled. We will keep you posted on when to make some more sales as per usual!
 
All Regions / Should we be locking in futures on May spring wheat, canola, and soybean basis contracts?
 
No. I would wait for some rebound in the futures before making the call on any open May basis contracts. Use $680/T as a target for May canola, $6.50/bu on May Minneapolis wheat, and $10.79/bu on May soybean futures if you want to have something on the board to monitor. Or just wait for recs & further instructions from us leading up to April pricing deadlines.
 
MB-5, SK-8 / Should a guy be locking in -$15/T for July canola at the crusher? I can also get -$15/T for Oct/Nov. Would it be wise to get some tonnage locked in and wait on futures to strengthen more?
 
There's a couple angles to consider on old crop basis. At the crusher we may see some widening of basis if Trump does officially go ahead with tariffs on canola. There's the other side of the picture where supply is tight and crushers will likely be looking for more production come spring/summer if the demand picture hasn't changed. I heard a crusher in MB saying they will be actively looking for canola for the next few months. So I think in this case since the basis is not too bad still I would take it on some, but maybe keep some powder dry as well.
 
As for new crop, you will typically see Sept-Nov delivery months widen quicker than the deferred months. And in many cases the deferred months will narrow up (get better) as we inch towards year end. Basis would narrow on a tight supply, a boost in demand, or a drop in futures (hopefully not the last one). US tariffs can add risk costs to crusher basis, but I’m not convinced that’s a big long-term concern. In general a -$15/T for November is a good deal historically.
 
MB-5 / Should I be taking a -$20/T for Sept movement on canola to the crusher?
 
That is a good spot to secure the early harvest movement. We usually see the early delivery months widen out, especially off the combine movement, as they tend to fill up faster. I would consider that offer on some of needs for harvest. Then wait for the next rebound in the futures.
 
SK-14 / What should we be sitting at for % sold on red lentils? Do you see any chance of a rally before next crop year?
 
We have recommended up to 70% sold and are waiting to see if .36/lb can hit in May to make the next recommendation. Will either sell 15% or all that is remaining on the next recommendation, depending on the trend. There are some .34-.35/lb offers hitting in some areas of SK this week if you are low on sales and looking to catch up a bit. Not a bad price to do some at. The seasonal trend shows some pretty confident stats for upside in Mar-May as Ramadan winds down and some renewed demand returns to the market. It's also a lull in the year where there isn't any fresh supply hitting the market yet.
 
SK-9 / What's feed barley looking like in my area? I can get $5.25/bu locally for April and maybe $5.40/bu for May. Any chance for higher than that?
 
We made a recommendation last week to get 1/2 of what's on hand sold. Those prices you mention would be around the best we have heard for this area lately after a nice bump in values last week. I'm not ruling out a higher offer in May-June but we can't guarantee that either. I think the best strategy is to minimize risk on this recent jump in price before getting a better understanding of the effects of US trade/tariffs. The high end barley price would have been around $6.70/bu or so in Feedlot Alley.
 
All Regions / Do you think malt barley prices could be screwed with tariffs coming on?
 
The US is our largest destination for malt barley exports. In 2023 they received almost 60% of our export share of malt. On the other hand, the US has few alternatives to fill the short-term need. So while tariffs would be negative for both involved, it leads me to wonder if the effects would be short-lived. We don't want to get too aggressive on new crop at $6/bu as it doesn't fit well from a profits perspective on a medium yield. But I would still be cleaning up old crop at current values.
 
AB-17 / Should I be selling some new crop yellow peas for $10.55/bu Aug/Sept movement? There's a freight cost of $16/T to consider on that.
 
$10.60/bu has been my line in the sand on new crop yellow peas. The freight cost makes it less appealing to start. I would hold off until you get that price closer to home at a minimum.
 
SK-7 / Do you expect small and large green lentils to stay within .06-.10/lb of each other this year? I'm trying to decide which size to grow.
 
Yes, I think that spread can be maintained. Prices will be dictated by S&D, but I wouldn't rule out a similar trend as last year, with some reliance on Australia not getting a massive crop, India's crop not improving, Indian tariffs don't change, and Canada's supply is average or better. Use .50-.55/lb LGL and .43-.48/lb SGL for B/E analysis. LGL & SGL still battle for top 3 crops based on gross return, net return & max return categories with corn & chickpeas.
 
SK-7 / What are you hearing for yellow pea & red lentil prices in my area this week?
 
There is a company in Estevan, within 100km of your postal code, that is offering .35/lb on red lentils for immediate delivery. The best price on yellow peas is around the $10.50/bu mark but it's a good couple hundred km away from you to haul. Not great for peas but the lentil price is something to consider.
 
AB-20 / I need to buy a load of corn. I was quoted $336/T delivered from Manitoba. Is that a good price? Freight is factored in to the price and it's around $90/MT. I don't need it right away, but within the next 3 weeks likely. Closer hauls are short corn and waiting on tariffs so nothing to buy there.
 
Yes that's a pretty fair offer. The $6.25/bu price is comparable to what we have been hearing for corn in central MB or maybe a touch lower actually, so not a bad opportunity. Tariffs by the US would likely strengthen the price of corn as futures can rise and there may be less corn supply available if it's not coming across the border as fast.
 
All Regions / Should we be buying fuel right now?
 
There has been a decent pullback in crude in Jan/Feb at about a 10-12% drop. Futures are oversold and holding trendline so far. Next market moving reports will be OPEC in March. Not sure what to expect there yet. Seasonally demand can push fuel up now to May. There's a couple ways to look at effects from tariffs. Less crude leaving Canada can drop domestic price but US having trouble sourcing cheaper oil can drive futures up. I lean to buying some on this pullback if the recent drop in crude has been reflected in the price you can buy diesel for. I won't recommend more than filling the tanks for 2-3 months.
 
All Regions / What will happen to currency if Trump puts tariffs on Canada?
 
There can be varied reactions to currency. Initially the CAD might weaken but if the USD starts to drop it can support the CAD. So it's not a clear cut answer. The CAD moving above 70 cents or falling below 68 cents will give us a much better sense of what to expect in the next 6 months. That's what I'm watching on the charts.