Glacier FarmMedia COVID-19 & the Farm



The Good, Bad & Ugly

The Good, Bad & Ugly

The Good: The canola markets continued to move higher today as the nearby November contract closed above the C$525 per tonne level. The news about the discontinuation of talks between the U.S. administration and congress on the second COVID-19 package came after the market close, which means that we may seem some weakness in the overnight session. The chart continues to be friendly for canola with the next major test being the C$530 per tonne psychological level. The next technical level is the C$534.20 per tonne level which represents the high set two weeks ago.

The Bad: Spring wheat futures are close to becoming the cheapest wheat in the U.S. as gains in winter wheat contracts continue to eclipse those of spring wheat. The Minneapolis – Kansas City nearby (December spread) closed to a four cent per bushel premium for spring wheat. The Chicago premium over Minneapolis is now a whopping 54.5 cents per bushel. There have only been two times in history that Chicago wheat has traded for an extended time at a premium. One time was earlier this year in December 2019 and January 2020, and the other was in the August, September and October period in 2007. The cheap futures for spring wheat are showing up in port bids with 14 per cent HRS in the Portland trading at a 20 cent discount to 11.5 per cent HRW. Global buyers are now paying a premium for lower protein HRW over high protein spring wheat.

The Ugly: All it took was one tweet about a suspension of talks between the White House and the Democrats which pushed the equity markets lower. The S&P 500 closed down 1.4 per cent on the day and closed at 3391 at the end of the days trade. Equity markets had been very volatile through September, and the uncertainty will continue to up and down trade through October.