Ontario Agriculture

The network for agriculture in Ontario, Canada

Summary of the data.
By Moe Agostino, Risk Management Specialist, Farms.com

Here is some analysis of the August data.


USDA AUGUST WASDE (World Agricultural Supply and Demand Estimates) REPORT HIGHLIGHTS

US CROP Production Report

WHEAT

US Total wheat production is estimated at 2.184 billion bushels up 71 million from last month with increase in all classes of wheat except for soft red winter. 2009/10 ending stocks are projected 36 million bushels higher to 743 million bushels as a higher production forecast more than offsets an increase in projected use and lower imports. Feed and residual use is raised 5 million bushels with the larger crop. Exports are projected 25 million bushels higher than last month, with lower production for Canada and Argentina which are major competitors in the western hemisphere wheat market. Global wheat supplies are projected 5.0 million higher with higher beginning stocks and increased prospects for global production. The 2009/10 marketing year average farm price is projected at US $4.70 - $5.70/bu down .10 cents on both ends of the range from last month.

SOYBEANS

Soybean production is estimated at 3.20 billion bushels, 61 million below the July estimate. Soybean yields are projected at 41.7 bpa down .9 bpa from last month but 2.1 above last years yields. 09/10 ending stocks are projected at 210 million bushels down 40 million from last month as reduced supplies only partly offset by reduced crush and exports. Soybean crush is reduced by 10 million bushels to 1.265 billion. Global oilseed production for 2009/10 is projected at 422.6 million tons, down 0.9 million tons from last month but still a record high. The 2009/10 marketing year average farm price is projected at US $8.40 - $10.40/bu up .10 cents on both ends of the range from last month. Soybean meal prices are projected at $260 to $320 per short ton, up $5 on both ends of the range.


CORN

2009/10 corn production is projected at 12.8 billion bushels up 471 million bushels from last month. The US national average yield is projected at 159.5 bpa up 6.1 bpa from last month. Higher yields this month more than offset a small reduction in harvested area updated from the June Acreage Report. US corn supplies are projected at a record 14.5 billion bushels, up 134 million from the previous record in 2007/08. Despite reduced prospects for livestock production 09/10 feed and residual use is projected 100 million bushels higher. Food, seed and industrial use is higher by 100 million bushels with higher expected use for ethanol supported by favorable ethanol producer returns and strong incentives for ethanol blending. Corn exports are projected 150 million bushels higher reflecting lower foreign production prospects and stronger expected import demand from Mexico and Taiwan. 09/10 ending stocks are projected at 1.621 up 71 million bushels from last month. The 2009/10 marketing year average farm price is projected at US $3.10 - $3.90/bu down .25 cents on both ends of the range from last month.

Views: 41

Reply to This

Replies to This Discussion

Here is the latest market review....

This latest USDA Crop Production and WASDE report was neutral for corn soybeans and wheat.

There were no real big surprises as corn and soybean yields were slightly lower than the average estimate.

If there were any surprises it was the slight increase in ending stocks for both corn and soybeans and the increase in feed and residual use for corn. There was no change in ethanol use but with a record July and August production we expect ethanol use to go up in future reports particularly if oil prices remain at current levels.

Corn prices will bottom around US $3.00/bushel, soybeans in the US $8.50 - $$9.00/bu and wheat prices will bottom when corn does in the next 30 – 60 days. Wheat will lose a lot of acres this fall/winter and corn will need more acres next year in a rising demand environment. This will also put a bottom in for canola, oats and barley prices. Seasonally the lowest prices of the year are from October 1 – December 1 of each year. We feel that 2009 could be similar to 2006 when grain prices started to rally on October 1st of that year as the markets turned there attention to new crop and started worrying about having enough bushels to meet demand.



Demand has been stronger than most had expected and with the IMF projected a 2,5% GDP growth next year currently at a -1.3% coupled with our forecast for the US dollar to trade as low as US $72 cents will cause demand to trump supply and send grain prices higher in 2010. At current grain prices 2010/11 looks like an oilseed market once again.



We see very little downside risk from here more upside risk. Weather remains favorable for late crop development and temperatures are slightly above average for the 10-14 day forecast.





Until Next Week, Have a Great Weekend,



Maurizio (Moe) Agostino, HBA, DMS, FCSI

Managing Commodity Strategist

Farms.com Risk Management

Toll-Free: 1-877-438-5729 ext. 5040

Cell: 1-519-871-2134

Fax: 1-519-438-3152

E-mail: moe.agostino@farms.com

Website: http://riskmanagement.farms.com

Reply to Discussion

RSS

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

CFO Donates to Sounds of the Season

Chicken farmers contribute $10,000 to CBC fundraising campaign for local food banks

Climate change to push food prices higher, report predicts up to 4% hike in 2020

The average Canadian family will pay up to an extra $487 on feeding themselves next year, according to an annual food price report that highlights climate change as a major culprit for rising food prices, especially in the produce department.

Have a Holly Jolly Christmas Tree Day

It’s the Most Wonderful Time of the Year to Choose an Ontario-grown Christmas Tree

Storing Of Wet Grain Could Result In Bulk Freezing

With the wet harvest, extra attention will need to be paid to stored grain over the winter.

Food Prices Expected To Increase In 2020

The 10th annual edition of Canada’s Food Price Report forecasts a 2 to 4% increase in food prices in 2020, bringing the predicted annual cost of food for the average Canadian family to $12,667, an increase of $487 over 2019. Canada’s Food Price Report 2020 is released jointly by Dalhousie University and the University of Guelph.

© 2019   Created by Darren Marsland.   Powered by

Badges  |  Report an Issue  |  Terms of Service