The Good: OK, spring wheat started the day off strong, but pulled back during the session and finished down on the day. What’s so good about that? When you compare the action in spring wheat to the other wheat markets, it certainly was the best performer of the day. Although nearby July spring wheat was down five cents per bushel, Kansas City and Chicago July wheat futures were down 15 and 16.75 cents per bushel, respectively. The concern about soil moisture conditions continue to support spring wheat values in the face of a sell off in winter wheat. July corn futures were higher today and the losses in the Kansas City contract brought spread down to nine cents per bushel. If you want to encourage wheat feeding, the markets are certainly all in at this point in time.
The Bad: The July canola futures contract closed the day down C$4.70 per tonne to C$864.00 per tonne. The losses were relatively minor, but the fact that the July soybean oil futures contract was up by more than one per cent in today’s session creates some concern for the July contract. Crush margins improved across the board today on the losses in canola. The market is still very complacent when it comes to the dry conditions that prevail across the Prairie region.
The Ugly: Spring wheat planting progress in the Northern Plains is well above normal at 49 per cent complete, with North Dakota reporting 42 per cent of the crop in the ground (20 per cent average). The fast planting pace isn’t only in spring wheat with 14 per cent of the corn (8 per cent normal) and two per cent of the soybean crop (two per cent normal). The reason that the planting is ahead of normal is the fact that soils are very dry across the entire state. The subsoil moisture ratings are 81 per cent short to very short, which is the worst in the past 21 years. This is the reason that the region is classified in the extreme drought category. This also emphasizes the need for regular rains during the growing season.