Markets

[furrowtickler]

I will question 20% canola in bin as well - ADM is a plus $85/tn for April - May. Never in history have I seen that. I know road bans and blah blah blah, but IMO there is less than that, 15% max more like 10%

[LWeber]

Plus 85 is $16.05 a bushel. That is 22 dollars higher
Than I/S vancouver.

[Hopperbin]

I will deliver to nova scotia for that.
Don't have time. LOL

[LWeber]

ADM AGRI - INDUSTRIES CO.

LLOYDMINSTER 23-Apr-13

DELIVERY MONTH FUTURES FUTURES
MONTH CLOSE BASIS
APR '13 RSN '13 $ 622.90 $ 15.00 $14.47
MAY '13 RSN '13 $ 622.90 $ 15.00 $14.47

[LWeber]

Off the November ...Geezus
There is a 69 dollar inverse.

LDC and Bunge have been plus 42 the July.

[Hopperbin]

Cannot immagine anyone selling new crop canola at these levels, does it actually happen? Psychologically we think there is a big canola crop comming and we need to sell or it is profitable according to our own records. Dam it the crushers are tighter than won't say who.

[LWeber]

Plus 85 is $16.05 a bushel. That is 22 dollars higher
Than I/S vancouver.

[jdepape]

No one will pay 85 over futures when they could
just buy futures and take delivery. Worst possible
case for say ADM in Lloydminster is to take
delivery of futures and get it in southern Manitoba.
From there is might cost, what, $35 to get it to
Lloyd - makes 35 over pretty much the cap on
basis at Lloyd. I could be wrong on the freight
from MB to Lloyd, but I really doubt it would be as
much as $85.

Highest basis they should ever pay is equal to the
cost of shipping it in from the worst possible
futures delivery point.

[mbratrud]

FYI Southern Manitoba to Lloyd would be more like $45/ MT. Weyburn to Yorkton is $25/MT Freight is nasty. Fuel is nasty.

[jdepape]

Thanks Mark.
So theoretical max basis in Lloyd could be around
45 over. Anything over that would make taking
delivery of futures and shipping it up to Lloyd
cheaper.

[Burbert]

Canolie on Comedian frames is long f'n
gone. Bin sweepouts are all that remain
unless Comedian framers have become
excentric to the 9th degree over this
long, long, long, Winter eh!
fharperandritz

[Kodiak]

Yorkton/Harrowby crushers have been around $40 over July. $40 freight on deliveries against futures would bring it in from about 300 miles out, but basis is positive everywhere - so that won't work. Lloyd is going to have a tough time getting anything to get past Yorkton. Basis can get much stronger than $45. And at some point the inverse just gets stonger too as buyers find that deliveries against futures is unattractive because would-be hedgers sell into a strong cash market.

At the present time, old crop cash prices are around $120/MT higher than new crop. Needless to say, the market doesn't want anyone to carry any old crop into to the new crop.

Some buyers will roll July contacts to November on unpriced basis-only deliveries. Summer weather and new market fundamentals will make whether that option pays an open question for a while. Nov could gain on July if new crop conditions are not good. A producer could do very well locking in a hot July basis and rolling to November. Time will tell.