Is $6.00 Canola just around the corner?

[SASKFARMER3]

A custom harvest operator in Lucas do Rio Verde said this morning. They have just gotten going the past couple days.

Early yields are as expected and in some cases better than expected. For the early season varieties the normal yield is 52-54 sacs. Some spots are yielding 55 sacs. This would be 49 bushel per acre.

" The yields are going to be FANTASTICO this year". Asian rust is under control - Normal pressure. White fly pressure is intense and many are spraying for this insect at the moment.

The Tsunami of soybeans is getting closer to hitting the market.

Farmers who can deliver in the next 10-15 days can get up to US$ 9.25 per bushel. Those bids drop to circa US$ 7.50 per bushel for Feb and March delivery.

With our lack luster market that just seems to sit their with no buyers and US imposing restrictions on meal and China coming up with BS Black leg claims is the Retarded sister of the oil seed world ready for a further crash. I think so.

[amun]

OIL at $79/barrel relates to higher prices than $6.00. I think we have floor price of $8.00

[charliep]

I am also interested in turning opinion into action. If I take both your forecasts, I would interpret you are both canola sellers/prices in the current market. I'll let you pick your month on a DDC but I suspect $9/bu should be available across most of the prairies. Picking on May ICE futures of $416 ish and a basis of $20 gives a look at $9 today.

[Zaphod]

I agree that the direction is lower and the note about oil prices is a good reminder that there will be a floor under the market. The Jul-Nov inverse in canola and beans is another signal. ****seed plantings in Europe are higher too. I think it's time to make a first new crop sale. The $9/bu ballpark still makes money.

[SASKFARMER3]

But zap the local crush plants are at .32 under and elevators are at -42 pretty tough to get nine when their is a 7 attached to the number.

[Zaphod]

At $32 under the Nov 10 futures, it works out to $8.85 for a first new crop sale. I'll have to shop around a bit to see if I can squeeze out an extra 15 cents. Even if I can't, I'm not a big believer in "magic number" pricing. Sometimes it pays to set the target a nickel or dime lower thant he magic number that everyone else has. On the old crop, I saw there are some pretty good basis (-5 to -10) for Mar-Apr pricing. That looks decent too.

[SASKFARMER3]

Zap not next falls price That's a gimme get 9 great place to start we like Jan 2011. But today local cash bids have a 7 in front of them and crushers have low 8 locally "shit happens".

[charliep]

Saskatchewan prices seem low. Alberta spot prices in the $8.50 to $9/bu range.

[URL="http://canola.ab.ca/dailygrains.aspx"]acpc daily canola prices[/URL]

[Zaphod]

Sorry, when I said I would start new crop pricing, I meant the 2010 crop. My old (2009) crop is 50% sold and I actually started selling Nov 09 futures back in July of 2008. So far, my average (on futures) for the 2009 crop is about $500. You know the old expression, "trade like a nervous cat in a room full of rocking chairs"? That's me. This year, it paid off but it doesn't always.
I don't pay nearly as much attention to basis levels. You can lose a lot more in the futures while you wait for an extra dime or two on the basis.

[furrowtickler]

Canola prices in Sask have almost always been lower. But it exagerated this fall/early winter due to the push of canola into the system. Tough canola is going out of condition/dried and dumped. More than the system needs at this time. Again carry out will be lower than anticipated IMO.
The canola buyers do not have to buy thus basis levels will continue to be wide until all this tough canola finds a home.