Ontario Agriculture

The network for agriculture in Ontario, Canada

Agostino: Bullish USDA Report Drives The Market Higher. Did you ever think we would see $7 corn?

Views: 574

Reply to This

Replies to This Discussion

These are very exciting times for grain producers.

Joe

Is anyone selling old crop and what about 2011 and 2012 grain?

If you look at the charts, this does not happen very often.

Question for Mr. Agostino:

 

Do you see outside political influences affecting commodity prices especially in light of all the civil unrest in the Middle East?   There is some (media) chatter that the G20 is tossing around the concept of controlling commodity prices.

 

As commodity prices rise, more people are pushed into poverty and spend a greater portion of their income on food which translates (sic) into smaller purchasing power for other consumer goods which in turn affects the economic recovery plans.

 

"French President Nicolas Sarkozy, who is currently the head of the G20, has argued that commodity speculators should be reined in in order to reduce food price spikes and volatility."

 

What would be the affect if international politic hands steps in and controls agricultural commodity pricing?

http://www.bbc.co.uk/news/business-12499214

Hi Joann,

Looks like the funds jumped out on Tuesday and hammered down the grain markets limit...

Interesting politics and food....do you think they will meddle?

I believe the meddling started when the CBOT merged with the Mercantile Exchange a few years back.

That effectively put all commodities on the same page where derivatives markets are concerned hence causing the food index price to fluctuate wildly.

Further meddling? What would happen if oil is not traded in American dollars anymore? I think that would have a greater impact on the price the Ontario farmer will receive and send a real chill into our economy.
Moe, can you speculate what circumstances (supply/demand adjustments) it would take to drive corn back down to $5/bu?

Yes politics can have a big influence but the CME has tried and warned since 2008 to rein in on crude oil speculators that they would impose strict position limits and since October of 2010 they continue to have hearings but nothing is done.  This would lower liquidity and transparency.  Governments need to stay out of markets.  Third world countries can not afford wheat whether its $3.00 or $9.00/bushel. This has more to do with local government policies and issues that need to be changed. At the end of the day these are all outside market influences that I call noise and they can create more volatility but since June of 2010 corn prices continue to rally in  the face of geo-political risks and headwinds. Lower supply ultimately drives prices higher. Of course higher demand in 2011 is also causing record prices and the only way we can fix this short-term is with a very large crop with big yields in the coming 2-6 months as demand is a lot stronger that many economists will give credit for.  I hope this answers your question. Please visit us at http://risk.management.farms.com

 

 

Moe:  could you please assess the following story?  How much truth is there behind the allegations of Goldman Sachs commodity price setting with their Goldman Sachs Commodity Index (GSCI)?

 

It would appear Goldman Sachs was in a ready position when the Commodities Futures Trading Commission deregulated the futures markets in 1999.  As a result, hedgers, that traditionally were directly involved with agricultural production were outnumbered 4-1 by investment speculators.   Trading of paper wheat outweighed the trading of the real commodity causing wild price fluctuations as a "new category of participants" entered the hedge markets.

 

You state that "Governments need to stay out of markets" yet there are calls to intervene in food trading by investment banks to hedge the price of food for the sake of the countries dealing with starvation. 

 

Should governments regulate who can and cannot trade a basic life necessity?  If so, how would you separate the pricing of grains used for food as opposed to grains used for energy?

http://www.foreignpolicy.com/articles/2011/04/27/how_goldman_sachs_...

Reply to Discussion

RSS

Agriculture Headlines from Farms.com Canada East News - click on title for full story

Saskatchewan Crop Conditions Up from a Year Ago

The first Saskatchewan crop condition ratings for the 2024 growing season are mostly up from a year ago, although the scope of improvement is variable. The weekly provincial crop report on Thursday pegged this year’s spring wheat crop at 87% good to excellent as of Monday, up a relatively modest 6 points from a year earlier, while the oat and barley ratings were 2 and 5 points higher, respectively, at 87% good to excellent for both. At 78% good to excellent, the condition of the canola crop was just a single point above a year ago. On the other hand, the condition of the durum crop was rated 93% good to excellent as of Monday, an increase of 21 points from a year ago, while the lentil crop was 15 points better at 90% and the chickpea crop a major 31 points higher at 95%. Gains for other crops fell somewhere in between. At 91% good to excellent, the condition of the flax crop was up 8 points on the year, with mustard up 14 points to 88%, and peas up 9 points to 91%. The canary cro

New Grading Changes Coming for the 2024-25 Crop Year

The Canadian Grain Commission has announced new grading changes for the upcoming 2024-25 crop year that it says will better meet the needs of the grain sector in Canada and grain buyers around the world. Among the changes are new variety designation lists for food barley, and updates to the assessment of seed coat discolouration in soybeans. According to a CGC release, food barley varieties are unique and different from malting or feed barley varieties due to the distinct quality features desired for food, such as high beta-glucans. And to ensure Canadian producers and the agriculture sector can realize the benefits of developing and growing these varieties, the CGC is creating variety designation lists for Barley, Canada Eastern Food, which will take effect on July 1, 2024, and Barley, Canada Western Food, which will take effect on Aug. 1, 2024. Meanwhile, as part of the CGC grain grading modernization project, the official Grain Grading Guide will be updated to clarify the asse

Alberta Seeding Complete; Crop Emergence on Track with Average

The final push was delayed by rain in some parts of the province last week, but Alberta seeding is virtually now complete.  Friday’s crop showed the planting of Alberta major crops (spring wheat, oats, barley, canola, and peas) at 99.6% complete as of Tuesday, up a few points from a week earlier and in line with the five- and 10-year averages of 99.4% and 98.7%.  The report said final seeding efforts in the Central, North East, and North West regions were slowed by rain that was accompanied by persistent strong winds that led to an overall reduction in surface soil moisture in all areas but the Peace Region.   Regardless, crop growth is off to a good start, with the South Region in need of timely rains while the rest of the province needs warmer temperatures, the report said.  The emergence of major crops across the province is reported at 86%, which matches both the 5- and 10-year averages. Regionally, emergence of major crops is behind the historical average in the South and Nort

Automation, robotics helping farmers strengthen food security

B.C. farmers are accessing new technology through federal and provincial government funding to grow their businesses and increase production to help strengthen food security in the province.

© 2024   Created by Darren Marsland.   Powered by

Badges  |  Report an Issue  |  Terms of Service