Cattle futures on the Chicago market hit record highs yesterday for both feeders and live animals. Reports indicate that U.S. sales of chilled beef to Japan are up as that country works to restock its shelves. Sandy Russell of Spring Creek Land & Cattle Consulting in her weekly newsletter called The Bottom Line says April live cattle closed at $120.55, while March feeder cattle finished the day at $133.50. Based on early indications, Russell says Canadian fed cattle prices followed suit, with prices on the rail in Western Canada in the range of $195 to $198 per hundredweight. She says tight supplies of cattle on both sides of the border look to sustain these strong prices for the next few weeks as cattle feeders pull more animals forward to capitalize on the record price levels. Global fears had pulled futures prices drastically lower in the middle of March and Russell warns that market volatility is likely to continue. Usually we point to the high value of the Canadian dollar and the high cost of feed grains as reasons why cattle prices are disappointing. In this instance, cattle prices are record high despite those factors. I’m Kevin Hursh.
Grains, oilseeds, specialty crops, cattle and hogs. In almost all cases, the price levels are substantially better than they were a year ago. The Saskatchewan Ministry of Agriculture publishes a report that compares current commodity prices to those of the previous year. Feed barley at about $3.50 a bushel is a full dollar above last year. Current canola prices of well over $12 are more than $4 better than last year at this time. Yellow mustard is 31 cents versus 22 last year. Canaryseed is 26 cents versus 16. Yellow peas are $7.25 a bushel as compared to less than $5. Red lentils are a notable exception. They’re currently at around 20 cents versus 28 cents last year. Cattle prices have seen a major improvement over the past year. Feeder steers in the 700 to 800 pound weight range are averaging about $1.27 a pound as compared to just $1.00 a pound a year ago. D1 – D2 cows are averaging 73 cents, more than 20 cent a pound higher than last year. Hog prices are sitting in profitable territory at about $150 per CKG, versus $127 at this time last year. For the grains industry, an important report will be released tomorrow. The March 31 USDA Grain Stocks and Prospective Plantings Report could be a market mover. I’m Kevin Hursh.
The Mexican market continues to frustrate Canadian canaryseed exporters. The Canadian Food Inspection Agency has been decreasing the allowable number of weed seeds in Canadian canaryseed exports, but we still haven’t been able to satisfy Mexican authorities. I’m told that virtually all of our export cargoes are being sent for re-cleaning in Mexico. Cleavers has now been added to Mexico’s list of quarantine weed seeds, joining stinkweed, cow cockle and the wild buckwheat. It’s wild buckwheat that’s the most problematic. David Knobbs of CanPulse Foods out of Kindersley recently returned from Mexico. He toured Mexican plants that were re-cleaning Canadian canaryseed. By running their cleaning lines very slowly, he says the Mexicans are able to remove virtually all the weeds and hit the zero tolerance levels demanded. If Mexican cleaning plants can do this, Canadian plants should be able to do it as well, but it would come at a cost. Plus, there’s still a risk that when sampled a few weed seeds would be found and the cargo would still have to go for re-cleaning. Canadian exporters working with the Canadian Food Inspection Agency have tried very hard to resolve this troublesome issue, but unfortunately there’s still a big impediment to dealing with what has traditionally been our number one customer for the crop. I’m Kevin Hursh.
Will the Conservatives form a majority government or will they be forced to continue in a minority position? Based on the polling results being published, those would seem to be the two most likely election results. If there is a Conservative majority, what policy changes can farmers expect? The two obvious ones involve the Canadian Wheat Board and the long gun registry. The Conservatives, all the way up to Stephen Harper, have long wanted to remove the single desk, monopoly selling powers of the Canadian Wheat Board. Farmers are divided on the issue, but the marketing choice crowd has become more vocal and motivated over the years. This is one of the few issues on which you can actually differentiate the Conservatives from the Liberals. It’ll be interesting to see how often it comes up during the election campaign. If the Conservatives are true to their promises, a majority government would also see the end or serious curtailment of the long gun registry. This would be far less controversial that the CWB change in rural Canada, but urban areas would sing a different tune. In other farm policy areas ranging from farm safety nets to international trade, there’s not much difference between the two parties. And we’re at one of those rare junctures when farm income isn’t a hot issue, so there might be even less ag policy discussion than usual in this campaign. I’m Kevin Hursh.
The price projections for wheat and durum have dimmed a bit over the past month. In the Pool Return Outlooks released yesterday, most grades of wheat are down 20 to 25 cents a bushel in this crop year and 60 to 70 cents a bushel in the new crop year. The drops are greater on durum. Durum is down 40 to 50 cents a bushel for this crop year, while the new crop PRO is down more than a dollar on the main grades as compared to the projection made in February. For No. 1 CWRS wheat with 12.5 per cent protein, the new crop price projection, after deducting average Saskatchewan freight and handling, comes to about $7.11 a bushel, just slightly more than the price expected in the current crop year. On No. 1 durum with 12.5 per cent protein, the new crop price projection has declined to about $7.51 a bushel, after average freight and handling. So, durum is still expected to establish a new crop price premium over spring wheat, but the premium has declined since last month. The new crop PRO on malting barley is down 20 cents, giving a price for two-row of $5.61 a bushel. That number will be of interest to producers who are considering any Cash Plus offerings. Markets have been extremely volatile, and goodness knows what the PRO might look like a month from now when the next one is released. I’m Kevin Hursh.