I always like to look outside Canada and look at risk reward.
Likely the only one on the planet but not that negative on wheat going ahead. Record world world production but also record consumption. The challenge is most of the increased production this year is in the major wheat exporting regions. Watch China. Our challenge at home is to increase effiencies in the logistics system and move this big crop.
Feedgrains are the most negative but I think will adjst the most quickly. Expanding livestock numbers and acreage declines in 2014 plus whatever Mother Nature does. US ethanol policy.
Pulses somewhat along for the ride but western Canada continues to benefit from growing markets.
Most scared about soybeans/soybean meal. Has held up the best to date given the expected tight US carryover next fall but there are dark clouds ahead if South America harvests a monster crop and US farmers replace corn acres with soybeans.
Need to watch vegetable oil prices. Have declined a lot but I think will stabalize. Low prices create consumption. Biofuels policy and the potential impact of further declinces in crude oil prices will impact canola.
Things over the six months.
A solid balance sheet/lots of working capital. Farmers (in Alberta at least) have had some pretty good times. Do you manage your money or did you squander it?
Good storage facilities. It will take time to move this crop.
Understanding of carry in the market (being paid for interest and storage) and ability to capture it (be paid to store) using the different tools the market place offers.
Having a marketing plan and the discipline to act when targets are reached. No plan will be perfect - no one knows the future - but hopefully you have something that takes some of the stress out of decisions.
Likely the only one on the planet but not that negative on wheat going ahead. Record world world production but also record consumption. The challenge is most of the increased production this year is in the major wheat exporting regions. Watch China. Our challenge at home is to increase effiencies in the logistics system and move this big crop.
Feedgrains are the most negative but I think will adjst the most quickly. Expanding livestock numbers and acreage declines in 2014 plus whatever Mother Nature does. US ethanol policy.
Pulses somewhat along for the ride but western Canada continues to benefit from growing markets.
Most scared about soybeans/soybean meal. Has held up the best to date given the expected tight US carryover next fall but there are dark clouds ahead if South America harvests a monster crop and US farmers replace corn acres with soybeans.
Need to watch vegetable oil prices. Have declined a lot but I think will stabalize. Low prices create consumption. Biofuels policy and the potential impact of further declinces in crude oil prices will impact canola.
Things over the six months.
A solid balance sheet/lots of working capital. Farmers (in Alberta at least) have had some pretty good times. Do you manage your money or did you squander it?
Good storage facilities. It will take time to move this crop.
Understanding of carry in the market (being paid for interest and storage) and ability to capture it (be paid to store) using the different tools the market place offers.
Having a marketing plan and the discipline to act when targets are reached. No plan will be perfect - no one knows the future - but hopefully you have something that takes some of the stress out of decisions.