Statistics Canada Production Crop Estimate

[charliep]

Will highlight todays Statistics Canada report.

http://www.statcan.ca/Daily/English/060825/d060825a.htm

Biggest surprise/highlight is the barley number. Crop production - 10.3 MMT. Domestic feed use - 9 to 10 MMT (likely closer to the top than the bottom). Malt barley (domestic and export) - 2 MMT. Seed 400,000 tonnes. Competition from feed wheat - less around/higher prices. Production less than disappearance - drop in the carryover.

[wd9]

Charlie, the dates of the survey were July 28th to August 6th and many necer realized the extent of the heat. Do you think farmers were more optimistic then as opposed to now that harvest has begun?

Very interesting feed barley days ahead. When is the prediction to see some pricing action in that market?

[charliep]

Suspect it will likely take till winter to get some real action going. Normal selling off the combine to pay bills and manage bin space will hold back any real rally potential (as demonstrated by today's market). As IAMTHEMOLE as indicated, we are likely close to some corn imports.

I note the wide basis on barley relative to futures. This is one area where I think there can be some give over the next little while (i.e. narrower basis levels).

If I was a feedlot right now, I would be buying cash barley and storing (even if it meant piling).

[melvill]

Charlie, always surprises me how few deliveries there are against Western Barley futures when basis levels are as weak - or wide - as they are now. Great opportunity to pick up some extra value.

[IAMTHEMOLE]

THIRD PARTY DELIVERIES ARE DIFFICULT IN THE HARVEST PERIODS. WHY WOULD A REGISTERED ELEVATOR ACCEPT YOUR GRAIN AT A BASIS WHICH IS NOT REFLECTIVE OF THE CASH MARKET. AS WELL,GRAIN MERCHANTS WHO ARE ABLE TO DELIVER, ARE RELUCTANT TO GUARANTEE ON FARM STORAGE.
WHAT IMPACT ON FUTURE PRICES DO THE FUNDS HOLD ON WESTERN BARLEY. IT SEEMS THEY ARE HOLDING A LARGE PERCENTAGE OF OPEN INTEREST. WOULD IT NOT BE CHEAPER FOR THEM TO OWN CASH BARLEY. WHY ARE THEY RELUCTANT TO DO THIS.