Episode Transcript
[00:00:00] Speaker A: Markets this morning. We're kind of trading mixed here as we kick off this, the shortened week, shortened trade week. We've got canola up 2 and a half dollars a ton, trading at 6.77and change off the May contract. The November contract's actually flirting with a 685A level we haven't seen since August.
And it just underline that one, folks. Underline that move and that timeline. All right. That timeframe. I've got beans down 4 cents at 11:44, again, hitting a high that we haven't seen here since, you know, called like early December. So it's been a minute there as well. Spring wheat down three and a half cents at 5.80. Come on, spring wheat, let's go. Bean oil down 25. Basis points, 57.23. Bean oil's been ripping since January 1st.
We started the year at 50 cents a pound. Right. It's absolutely ripping. In fact, I was looking at Susan Stroud's work over the weekend, and being one of the top performers here, even when you threw for the year, threw silver and gold into the mix there as well. So. Interesting stat. Kansas city wheat down 6 cents at 5:47. A really, really nice run late last week in Kansas City Wheat. We'll talk about that a little bit later on in the show. Corn's down a nickel this morning at 437. And there we have it. Canadian dollar lower as well at 7323.
Looking.
Yeah. Maybe for a little opportunity here to buy some Canadian dollar at some point. We'll see. We will see.
All right, we've got. We've, yeah, we are off to the races here. So we're cruising. Awesome. Again, folks, the technology here, sometimes a bit of a struggle, but we're going. We're cruising.
Now, the questions that came in this week, and we'll get to our guest here in just a second, but we got a couple. We have a question came in in regards to red lentils. What do you think about the red lentil market and the price of $0.24 for new crop, which is, in fact, my budgeted price for red lentils for 2026. So that's a really good one. I think that's a level that we'll have to talk about in more detail throughout the show here. And then the second question that came in, do you feel that there will be less durum planted in 2026?
If so, roughly how much? I'm curious of a pullback in acres will bring a rally. A lot of Folks looking at cereals in general right now, wondering what to do from a serious perspective. Do we put in the spring wheat on a bit of a flyer? Do we just put it in, see what happens that we go with some of the certainty around the feed barley market, maybe malt to some degree. Do, do we look at oats? What's going to happen with Oat Acres? What's going to happen with Durham?
A good question as well. We'll circle back to that later on in the show.
Now let's talk about some headlines here and then we'll bring in our guest a couple. It's kind of like repeat news for this morning. There's nothing that really jumps off the page here. Of course, the US has sent a second aircraft carrier to the Middle East. That's kind of old news. But what I want folks to watch is that storyline and there are some nuclear talks going on between Iran and the U.S. but what we want to see here is does heightened or elevated or a rallying crude oil market or energy market, does that lead to maybe some support in the Canola market here just a little bit this week, right? Just a little bit. There's lots of stuff going on for Canola, but does it help out just a little bit? We also had late last week Trump's social media machine firing up and and helping boost soybeans. U.S. and China were looking to China was looking to buy some vessels for June and July. Again, this is kind of old news, but it did fire up the soybean market a bit. China's this is probably the most important one this morning. China's anti dumping probe on Canadian Canola is coming up for a decision on March 9.
The rumors around that are favorable, that the decision will be favorable. Of course we saw our government officials in China. They came back, announced that some type of deal, a reduction on tariffs against Canola, that was all happening.
But what I wanna say to this point is that this is being traded into the market. In my opinion, traded into the market today as it's going to be positive. This is positive. March 9th will be a positive day. It's already trading this in to the market. All right, so that's where I stand on that one. So the good news is already happening and sometimes a weird thing like maybe March 9th is the actual day where you know this news comes out and it'd be normal for the market to drop at that point. You know those weird days where you get good news and then the market drops. Wouldn't surprise me on that one.
There was one commodity last week that had an interesting week. This is from Susan stroud from Noble AG. Check out her work. But Chicago Futures saw not one, but three of their top 10 largest volume days on record.
This was attributed to spread trading and not a fundamental change in wheat. So that was really interesting. Of course, Russia's had some cold weather concerns. You know, the U.S. the drought maps, the dryness, that thing. Those storylines are starting to fire up as well. And we're getting into the timeframe here, March, where that crop will come out of dormancy and we'll actually see what's going on. So Kansas City Wheat down Friday, down today. But when you look at that chart and draw in that some of those technical lines, it still looks like a buy opportunity for those that want to participate. So, again, talk to the professionals out there, folks, the folks that are licensed to help you through these.
Help you through these strategies. All right? And then my last one here is just the commitment of Trader Report Canola moving from, you know, being a short position, you know, negative position to a neutral position. And of course, you want to add that in with massive canola deliveries to the crush plants, massive canola deliveries to the elevator system. And we also are sitting here somewhat neutral from a funds perspective. Are they going to start buying this thing to a larger degree? All right. Or do they go long in this market? So, lots going on. So let me see if I can hit the button here to bring in our guest this week, Sarah Koche with Trigger Grain.
Good morning, Sarah. Can you hear me?
[00:06:31] Speaker B: Yeah. And good morning.
[00:06:33] Speaker A: All right. How do you like that? Three attempts to get the show started this morning. That was pretty good.
[00:06:38] Speaker B: It's okay. It gave me more. More time to drink my coffee.
[00:06:41] Speaker A: Yeah, yeah. All right, now we do have. I got some stuff I want to talk about. Sarah, you obviously cover a large part of the prairies. You got farmer customers across the prairies here. So you've been busy on the. You've been doing some presentations here across the prairies in front of some great audiences. What have you kind of learned in your travels? Like, how's the mood out there? Is there any theme that. That pops out?
[00:07:07] Speaker B: Yeah, I would say the mood is better than it could have been for where most of our profit margins are at. I think everybody out there is looking for the crop that's going to actually make the money and pay the bills this year. And I had a lot of conversations about, like, potentially switching some acres and really looking for something different, trying something new. And, yeah, just kind of Looking people are interested in talking about growing some different crops, which is fun to talk about.
Be more fun to talk about. If the, if there was a huge home run and prices were fantastic on.
[00:07:40] Speaker A: Something, is there any crop that kind of stood out from an acre perspective, an acreage change perspective where you just sat there and were like, oh yeah, this one is really gaining some momentum in conversations.
[00:07:51] Speaker B: Yes, I would say people are. People that have never spoken about lentils before were wondering if lentils were the one.
People were asking me questions about coriander and caraway and all the interesting like spice and herb ones, which I do not even pretend to be an expert on. But yeah, I haven't found any home runs. That's all I'm saying.
[00:08:14] Speaker A: All right. All right, well, sounds good. I want to talk about some stuff amongst the cereals here later on. Well, as we get going here, I want to talk about Kansas City Wheat.
You've done some dandy strategies. I saw some, some nice basis levels that you locked in not long ago.
What do you think about Kansas City wheat futures right now? Are you still feeling pretty good about how it's going or are you getting closer to pricing some of that?
[00:08:42] Speaker B: I was getting real close to pricing at the end of last week there.
I also had a long position on, on my own farm and I did sell out of that, but I also have a basis contract on with few people and I haven't priced that yet. I'm hoping for a little bit better. It would have only worked out to about 775, 770 at the peak and I was going to start at 775. So I have targets in.
I like where it was going. I hope that we can find some continued strength this week or in the next month because I've still got quite a bit of time on those.
One thing I did want to talk about on Kansas City is for new crop, not necessarily September futures, but I think like those next year, March to May futures are definitely worth looking at. If you're going to be a CPS grower, don't sleep on 20, 27 futures right now.
[00:09:39] Speaker A: Yeah, I'd echo that as well. And I even took a look at fall at 27. I know that sounds kind of scary to many, but, you know, with a carry in the market like that, it's something worth looking at if you're a consistent CPS grower. All right, now you've got, you've worked at the crush plants before. You've worked as a grain buyer in the past as well. You got a whole history of that side of the. Of, you know, the grain industry. What are you seeing out there for old crop movement? Is it. Is it still really busy out there? Are lots of farmers hauling in? Is there lots of specials or has it gotten quiet?
[00:10:15] Speaker B: Well, it's actually been. It's been an awesome winter, especially the last few weeks with some better weather.
There is in my area. There's a ton of peas and barley moving into the elevator system right now.
We'd moved a ton of wheat earlier and. And it's really cooled down on the wheat specials, and it's really bumped up with the feed barley and the pea, yellow pea. So it's actually been exciting. It's been a great February.
I do hope that the elevators start to loop back to wheat, because I could really use some better wheat specialists. A better wheat basis right now would help.
[00:10:51] Speaker A: It's feast or famine. You look one day and you're like, oh, nobody's buying. This is terrible. And then the next day you look, oh, there's a special in it. Just crazy how it is out there right now.
All right, I want to get to some of the questions that came in. So this Canola rally, a really healthy Canola rally, November flirting with 685 this morning.
Where do you see canola futures going? It's a loaded question, but where do you see canola futures going here for new crop.
[00:11:17] Speaker B: For new crop November futures.
I think that we can't really take for granted the rally that we've gotten so far and the level that new crop futures are at right now.
I think we definitely need to reward where we've been because there's absolutely no guarantees that it stays here with the big carryout that we're talking about.
I'm not saying that we're not going to get a spring rally. I really hope we do. We generally do. But I think it's going to take like, a ton of exports to move out in the next couple of months for us to see a whole lot higher.
[00:11:53] Speaker A: Well, I'm going to add to that before you throw a value in, but I want to just, like, I just want to say we have the demand now. The elevator system, the export market. We have a. We've had a huge surge in demand. The crushers are pretty much full and have been buying plenty. And I don't. I can't find a crusher that's super excited about anything trying to cover some May. I'm starting to see elevators trying to cover May as well. But we have really Good news right now. Everything's been really, really positive. And so don't forget that, because all the good news is happening right now. All right? And so in one of my.
My insights here, like, I wouldn't say that this is unforgivable on my end yet, but, you know, I'm working on my defensive strategies on Canola. This is what I'm spending the bulk of my week doing because we are getting close to that 700 level. And, you know, I want to be able to, like, unleash my plan when the time comes. Like, my clients that rely on me.
It would be unforgivable if we got to this level and left it with nothing or very little done. Like, that would be like, what the heck? We have everything 100%. So, yeah.
[00:13:04] Speaker B: Yeah, I feel the same way. So I've been busy with that as well. And, like, again, just do not sleep on new crop Canola right now, because there's no guarantee that it goes any higher.
[00:13:14] Speaker A: I.
I like the momentum we have. I like the chart action. I like, I've been patient as a saint on a lot of this stuff lately.
But, yeah, we're at the point here where, like, we're from last year. We're like a buck off the high. Like, this is. This is go time. Like, this is time to execute. Anyways, we're getting tight on the clock already.
We will go a few minutes over because of that fumble off the start. What about oats?
We came with, you know, a great comment about oats being a bit of a stinker out there, and it is. You deal with some. Some old farms, right? Like, what. What's going on out there?
[00:13:51] Speaker B: Yeah, so when I pencil out oats for 20, 26, they don't come in a whole lot worse. It depends on your yield and your own farm, but oats, wheat, and barley are within, like, just a couple dollars an acre right now. So if you can make oats work for you and if we can snag some, like, awesome new crop specials, which I haven't been able to find yet, but I think at the level that they're at right now, they can pencil. And if we can snag something a little bit better, I think. I think you'll be just fine. On oats, like, it's ugly. There's. We haven't been exporting a lot. It's freaking boring this year, but I don't think it's gonna, like, stay that way forever. So I'm not gonna cut oats out.
[00:14:34] Speaker A: So I. I think the Traditional oat grower at these values just hangs in there and does what they always do. I do think you'll lose a little bit of oat acreage this year the way it's setting up. But a 375 to a four dollar oat, I'm not saying I like it, but that will put oats in the ground with the average grower like that will, will keep doing it because that yield potential, that's what they're going to weigh out it. You know, when I talk to farms with all three crops, it's the wheat acre that's really, really struggling with putting that in the oats. The barley's picked up a little bit, taking away from wheat. And not every area, I wouldn't say, at least not for our farm in Dormy, Saskatchewan, but over in Alberta. Barley's definitely making a move here and it's pulling away from wheat, not, not really the oats. But I do think oat acres are going to decline.
I want to circle back now to, to red lentils here at $0.24 a pound, that's very much like my budgeted price for the year.
And I didn't see the 24 cents. Actually I didn't see it yet. So if 24 cents for new crop, I saw 26 cents for old crop. But in that, you know, at 24, 25 cents, like I would start as a red lentil grower, I would start. If it's profitable for your farm, I would start doing a little bit of pricing because I think that number is again, not stellar, but does keep those acres in play in 2026. Sarah, any thoughts on lentils? And I think you, I don't know if you have any lentil growers, but.
[00:16:02] Speaker B: Yeah, I do and I haven't found a 24 cent red lentil price. It seems like new crop, red lentils have been very quiet for me so far and I don't have, I don't, I'm not, I'm not going to switch to growing lentils on my farm for that. It's not, it's not a home run, it's not a knock it out of the park. But if you're growing them anyways, I agree. I would definitely start there. It's better than where it's been. So.
[00:16:24] Speaker A: And then on Durham here I've got, you know, how much are acres going to decline this year?
Interesting. I went back and forth with the grower, multiple emails and I said, well, I'm budgeting the same type of price for both crops. And he's like, yeah, that's my point. He's like, I want to put like the spring wheat in instead of the Durham because at the same price point it doesn't make sense. So acres are going to have to come down. And yeah, I agree, acres are going to have to come down.
But to what level? Durham rallies.
Unfortunately, it's probably a question of what type of quality do we get again for our derm crop this year. It's probably one that you sit there and say, okay, we're going to plant less, 5%, 10% less, whatever it is.
And yeah, away we go. There my timer is going off.
So I don't know to what degree yet, but I do think that it will take until we figure out what type of crop we have quality wise before you could see, see a large rally.
All right, a couple other things here on, on the insights. I just wrote cereal crop rankings for your own farm. Grab your pencil, pencil that out. You know, is, is it Durham? Is it spring wheat? Is it oats? Is it barley? I was chatting with a grower last week and I said barley is control my destiny. I can control my destiny by locking in some pricing now. And if it, if it's profitable, it makes sense. You can control your destiny. Oats is the safe bet because I don't expect the price to move a bunch one way or the other. And wheat is my, is my flyer. It's my, it's my hope and my prayer because the basis we have for new crop is terrible. Which is, that's not a surprise. It is at this time of year. And so can we get bullish basis? Yes. By how much? That's a question mark. And what do you pencil in there? So I like, I like figuring out your cereal acres this week. I like getting defensive on your Canola strategies.
Two last things here, an email from, from Cargill late last week. On Friday today we will be reaching max capacity with our bin levels. This is Camero's Alberta. Extra loads will be turned away. Please let us know if you will not be delivering loads. So that is a crush plant at max capacity. That email doesn't come out that often, so that's something to note. And then John Depap with the, the trading floor. We had the largest week of Canola deliveries ever in February. Canola moving from farm to the elevator system for that demand.
But this is all good, good news stuff. Maybe not the crash plant being full, but good news stuff that supports this market. Don't lose focus on that.
All right, Sarah, with Trigger Grain. Any last comments here? The 20 minutes. It goes fast.
[00:19:08] Speaker B: It sure does. I do want to say ADM and Lloyd is experiencing the exact same kind of thing, which is probably why Cargoland Cameras is filling up as well. No, just keep your pencils sharp and.
Yeah, figure it out.
[00:19:21] Speaker A: All right, sounds good. This week's cup of coffee was brought to you by DG Mobile Seed Cleaning. Contact Dion at 306-321-5411 for your seed cleaning lead needs. Pardon me again. Shout out to a Dormy, Saskatchewan based business and a couple of young fellas just giving her putting through the bushels. I'm out of coffee, folks. Thank you, Sarah. That's it for this week, guys. I'll see you Friday. On what the Futures.
