Which crop has the biggest price upside? Where will canola acres land? Do I really need to know my cost of production? Brian Voth, transplanted Manitoban and president of IntelliFarm Inc., is our latest RealAg LIVE! guest, and he fielded all sorts of questions.
(Check out the full video/discussion below)
- Let’s start with canola! And acre predictions.
- Resistance sits at $485 level. Even with real gas in the tank, $500 would just be too high, due to the supply situation
- Biodiesel markets in the EU have taken a lot of canola, but non-GMO use in #westcdnag limits exports for food use
- China is still buying canola, though not as much seed, but is actually still buying oil. On the grand scheme of things China is still buying Canadian canola
- Soybean time: these acres are going up, cheaper to grow and outlook is better vs corn. Now, MFP etc. may mess all that up
- Brian pegs corn acres at about 94 million, but because of how fast planting is going, there may be less time to swap out, and completely opposite to where we were last year. Let’s face it, farmers love growing corn
- Brian likes charts. This does not surprise anyone who has ever talked to him about markets.
- A flour shortage is NOT because the bins are empty. Wheat can be a tough one because it’s just got such steady supply, world-wide. Supply chain disruption is to blame for the flour shortages, and consumer buying behaviour
- That said, U.S. wheat acres are at a record low
- Half of the wheat in the world is held in China. And it’s historically very tough to peg those numbers because it’s so hard to get solid numbers, but that wheat is used domestically.
- Corn acres in Canada? As a percentage, likely won’t shift in huge numbers.
- Greatest acreage gain, likely pulses. Primarily in Saskatchewan, of course. The StatsCan report may not have surveyed southern and western Saskatchewan, given the numbers.
- Mustard, peas, and durum: who’s the winner here?
- Is there much downside risk for pulses? Not huge, no.
- And, finally: marketing decisions need key information first, and that’s your farm’s cost of production for each crop. What makes a good crop price? It needs to be about profitability, not just a magical number.