Colza.... AKA Canola

[WiltonRanch]

I am ignorant to world demand for oilseeds but it seems the world uses up all the soy farms can produce. Cereals are a different story. For the big gains in canola and soy production the price of canola doesn’t seem to drop off yet. Is demand increasing such that any new players coming on stream will bomb the market? Is more of this demand industrial or feed?

[bgmb]

I not very worried about Argentina out competing us. I am sure their economy will be wiped out by hyperinflation again soon.

[bgmb]

Also Klause, You forgot Argentina is famous for export taxes. Currently they have a 30% export tax on beans. Can't imagine that is helping their competitiveness

[Klause]

I not very worried about Argentina out competing us. I am sure their economy will be wiped out by hyperinflation again soon.

Wow.

Argentina did very well until US meddling in the mid 20th century...

With a waning US influence and hundreds of billions in Chinese investment... It's worth keeping an eye on.


China is seeing Canada as a hostile investment region... While Argentina Chile Brazil and other Mercosur countries are welcoming of the foreign capital.

Soybean Meal Exports by Country in 1000 MT

Rank Country Exports (1000 MT)
1 Argentina 28,650.00
2 Brazil 13,600.00
3 United States 9,253.00
4 India 3,950.00
5 Paraguay 2,325.00
6 Bolivia 1,290.00
7 China 1,000.00
8 EU-27 700.00
9 Canada 200.00
10 Norway 155.00

In wheat Russia bumped us to 3rd largest exporter and Argentina moved from 15th to 7th in 4 years.




Unless we start watching learning to compete between the FSU and Latin America we will be done in commodity production

[farming101]

I could be wrong, but Argentina's increased wheat exports blew out their carryover. Export amounts going forward could be volatile depending on annual production results.

[blackpowder]

Well we cant change the Rockies, or the Shield, or the muskeg and sea ice.
Right of ways for extra rail lines doesnt change the distance.
COPs will have to change. And N to S rail.

[AlbertaFarmer5]

Lots to be pessimistic about. But keep in mind, that Brazil, Argentina, Ukraine, Russia etc. have virtually all their eggs in one basket. Commodities. While low prices will be curing low prices, their economies will suffer disproportionately to ours. We certainly could be more diversified, but are in a much better position to survive an extended period of very low commodity prices than they are, where virtually all government revenues come from commodity production. What will the tax burden be on the farmer, the currency implications, the interest rates (and they are already substantial). The civil unrest, the government instability. They may be on a path to taking over, but it won't be without substantial bumps in the road. How many infrastructure projects get delayed for decades yet again as governments run out of revenues.

[dmlfarmer]

Lots to be pessimistic about. But keep in mind, that Brazil, Argentina, Ukraine, Russia etc. have virtually all their eggs in one basket. Commodities. While low prices will be curing low prices, their economies will suffer disproportionately to ours. We certainly could be more diversified, but are in a much better position to survive an extended period of very low commodity prices than they are, where virtually all government revenues come from commodity production. What will the tax burden be on the farmer, the currency implications, the interest rates (and they are already substantial). The civil unrest, the government instability. They may be on a path to taking over, but it won't be without substantial bumps in the road. How many infrastructure projects get delayed for decades yet again as governments run out of revenues.

You are ignoring the change in policy by China. China is investing heavily in Brazil, Argentina, Africa agricultural related infrastructure. Why simply buy US debt when they can use the same funds to build railways, port facilities, and roadways which will enable them to access needed imports cheaper in the long run. For example, they recently announced US 50 billion in investments in Brazil alone. On the drawing board there is a railroad to the Pacific, which will eventually provide a rail link across the continent. We sit here and complain about poor rail service to move our grain yet our major competitor is getting our major market to build a railway to move their grains to the west coast. Not only is China's strategy good for securing needed imports but is a great way to raise its profile in the world. Meanwhile we sit here and claim the free market will solve all our problems. There is no such thing as the free market in food production anymore. Between the few global grain companies which dominate the market, government trading and interference, and the lack of any cooperation, coordination, and market power of farmers in the world, the free market is a joke in farming.

[furrowtickler]

I wonder how much carbon tax Brazil and Argentina farmers are going to have to pay in the coming years ? 🤔

[AlbertaFarmer5]

You are ignoring the change in policy by China. China is investing heavily in Brazil, Argentina, Africa agricultural related infrastructure. Why simply buy US debt when they can use the same funds to build railways, port facilities, and roadways which will enable them to access needed imports cheaper in the long run. For example, they recently announced US 50 billion in investments in Brazil alone. On the drawing board there is a railroad to the Pacific, which will eventually provide a rail link across the continent. We sit here and complain about poor rail service to move our grain yet our major competitor is getting our major market to build a railway to move their grains to the west coast. Not only is China's strategy good for securing needed imports but is a great way to raise its profile in the world. Meanwhile we sit here and claim the free market will solve all our problems. There is no such thing as the free market in food production anymore. Between the few global grain companies which dominate the market, government trading and interference, and the lack of any cooperation, coordination, and market power of farmers in the world, the free market is a joke in farming.

Exactly. " will eventually provider a rail link" we have been hearing that for decades already. But even Chinese investment will dry up during periods of extremely low commodity prices. No doubt it will happen, but likely not in the time frame many are expecting.

[bucket]

But when you look at the stats Canada's rail system has stagnated in relation to trend ....at least south America is building to the future....

We are resigning to the past....

Even if south America does nothing they are still gaining on us....while we ignore what should or has to be done....

[Kinger]

Both China and Saudi Arabia are looking to protect there food sources for the future.

The port G3 is building honestly doesn't need to be built when you look at our production, elevator space, and domestic use. But they aren't just building it to make money they are building it to protect their food sources.

COFCO(China's food buying agency) opened last year a trading floor in Winnipeg. Haven't heard anything regarding what is going on there but wouldn't surprise me if they started sourcing grain in the future for themselves directly.

More players in the game competing for grain is a better thing for us. For now.

The low prices cures low prices/ high prices cure high prices also applies to grain companies.

If they start struggling we will see more consolidation and/or closing of elevators in extremely competitive markets. cough Red River Valley cough.

Likely getting ahead of myself as that's more like a 10 year or longer problem than a next year one.
Or i'm just totally out to lunch and wrong. 50/50