Uneven profitability and mixed prices for the rest of 2020 will dog grain, oilseed and pulse markets.
A market review by Farm Credit Canada suggests trade tensions with China, African Swine Fever disruption of meat and feed grain markets, global grain inventories and challenging growing conditions will cause mixed prices.
Continued reduction in hog populations from swine fever and poor ethanol demand in the U.S. could reduce demand for feed grain and corn, and impact prices. Low prices will cause tight profit margins.
Faster rebuilding of the Chinese hog herd and or agreement on Phase One of the China/U.S trade deal could spark demand and commodity prices.
Faced with record high global wheats stocks, markets expect a 10 per cent reduction in the price.
Weak durum supplies have improved margins for durum wheat.
FCC expects corn profitability to be positive from weather challenges.
A reduction in seeded canola acreage will offset strong year end stocks with an average forecast price of $465 a tonne.
Export restrictions to India hold back yellow pea prices while green peas will have positive margins.
Lentils profitability, challenged by year end stock levels, depends on continued access to the Indian market.
The canola price forecast of $465 a tonne sits less than one per cent below the five year average.
The forecast $243 a tonne for yellow peas is 20 per cent below the five year average.
Red lentils, forecast at $397 a tonne, will return 28 per cent less than the five-year average.
Spring wheat, forecast at $241 a tonne, will fetch 10 per cent less than the five year average.
Durum wheat at $253 a tonne will return 12 per cent less.
At $255 a tonne, the Alberta barley price will reduce income by 22 per cent.
Ron Walter can be reached at ronjoy@sasktel.net
