Too much wheat

[Hopalong]

Looking at US wheat futures, seems to be 30 to 50 cents carry this year to next depending on class.
Explanation?

[farming101]

Regarding carry in the futures, some have defined that as saying the market is willing to pay you to store it.

That makes it sound like a premium. I think that's misleading.

Really what it means is that there is a discount in the market right now, and that if nothing changes, deferred months will drift lower.

The discount is not as great as back in Sept 14 though, which seems to indicate there may be some optimism for new crop price improvement. But it looks like a grind higher; no big rallies. Opportunities to lock in new crop sales at profitable prices may be few and far between.

How the world winter wheat crops are shaping up will steer prices for the near future.

[blackpowder]

Captain Bligh and his Flying Dutchman still insist we grew the only real wheat in the world. Hell ya grow more, stand behind him and blame the *** rain for a wet head!

[farmaholic]

Every tonne will get bought especially if the price is low enough. Its up to you whether or not you sell(well maybe not, financial strength might be dictating). I didn't carry forward any from 2013(other than seed) and 2014 is also now all gone. Cereals are a necessary evil of rotations. Good thing there are options.

[farmaholic]

All gone.... with 5 months left in the crop year.

Sorry to the fellows who have outstanding delivery contracts.

That's another story that needs fixing.

[MBgrower]

Apparently canadian wheat at vancouver is on sale 12 months of the year. Buyers are so pissed with the vessel delays, canadian graincos offering cheap grain relative to usa DNS wheat. Another reason for shitty basis prices in the country.

[Braveheart]

Everyone is saying CA grain on sale etc. The basis in ND has sucked all winter as well. Plus MPLS wheat futures less than lacklustre all winter.

Canada isn't exclusive. Wheat is oversupplied. Demand for wheat is stagnant. No fundamental news to move the market. Strong US dollar keeping a lid on futures values.

[farming101]

Looking at the last 3 calendar years of wheat sales other than durum by Canada to the world:
In 2014 41 countries took the most wheat out of the 2012-14 period.
The top 11 countries for exports took the most wheat in 2014 out of the last three years.
Countries that took less in 2014 than in 2012 or 2013 numbered 27, with a total amount of 2,390,058 tonnes less than their best year.
The largest reductions in exports were to China(486,310t), Iraq(379,663t), Sri Lanka(258,037t), Brazil(190,034t), Ghana(156,356t), Philippines(144,530t), Malaysia(142,339t), Vietnam(128,640t), Jamaica(101,494t), Iran(78,740t), Thailand(77,888t), Egypt(64,949t). The rest were less than a panamax in volume.
China, Iraq and Brazil fell below the top 11 importers.

[SASKFARMER3]

Topic should be shit show loading at coast and rain plus way to much for industry to handle.
Ah who thinks the Canola 2020 thing will give one thing also low prices.
If industry cant ramp up their game how can farmers expect to get more for their product.
Big Volume is low prices.

[farming101]

In doing a bit of research it would look like in every case except China it would be valid to ask why exports dropped.
I don't know, likely lots of reasons.

Most likely:
1) couldn't supply in a timely manner
2) quality control problems made customers look elsewhere
3) Price too high

[bucket]

Our prices are not too high. So I guess it's 1 and 2.

[charliep]

What happens in a year when Mother Nature steps in and western Canada produces a small crop?

I know the discussion is more about the domestic situation but I look at the world demand side. Is a 1 % growth in world crop consumption out of line/too big? That is about 7 MMT increase in world wheat consumption every year. Am I being stupid in suggesting? If that is realistic, that means the world will be consuming an additional 245 MMT of wheat by 2050 with no compounding of growth.