Episode Transcript
[00:00:02] Speaker A: Hey, folks, welcome to the what the Futures podcast, where we break down complex market trends into simple, actionable advice. It's your quick guide to better farming decisions.
All right, folks, welcome into episode 59 of the what the Futures podcast. As always recorded in the UPL studio, we have a deadline coming up here, February 15th. That's how when you need to sign up for grower rewards program. That's the date, that's a deadline. And if you're sitting there saying, hey, I want in on this, I want to figure out this grower rewards program with UPL can head over to the what the Futures Podcast. Ca. That's the website.
Click on sponsors and you can find the UPL contact map. If you're sitting here saying, who is my UPL rep? Go to our website. We have it beautifully laid out for the western and eastern part of the country. And hey, check out the great folks over at UPL on the what the Futures website.
All right, episode 59, I've got David Lee with Marketplace Commodities joining me. We're going to talk feed grains. We're going to see if there's anything from a tariff perspective that we should cover as well. Of course I'm going to talk tariffs. I'm going to talk about. I go in like a 15 minute, maybe it'll be cut down a little bit. But just how to handle, you know, crop marketing right now, like, honestly, it's head spinning out there. It's confusing. Everybody has an opinion, which makes it really, really fun. And there's gonna be, it's one of those things where you're gonna look like a genius or you're gonna look like a complete jerk when it's all said and done, I just don't see any middle of the road here, you know. So anyways, we'll talk about some of that stuff in today's episode. Of course. I'm your host, Ryan Denis. I've spent my career working with farmers across Western Canada and covering all things crop marketing related for, I don't know, over a decade now. Something like that. If you find a helpful tip in this episode, if you think that someone else in your farming community can benefit from from the what the Futures podcast, please share it with them. You never know what it's going to do for someone's farm. Maybe it's a little confidence booster. Maybe it's an answer to a question. Maybe it helps them when it comes to crop marketing and farm business here in 2025. And thank you so much for sharing the episode. All right, okay, let's let's get into it here. Let's get David and get into episode 59.
All right, folks, I've got David Lee here with Marketplace Commodities. David, how's it going today, buddy?
[00:02:50] Speaker B: Pretty good, thanks, Ryan.
[00:02:52] Speaker A: Good.
[00:02:53] Speaker B: Beautiful day down here in Lethbridge today.
[00:02:55] Speaker A: Well, I was going to ask from a weather perspective, like, how's the winter gone in Southern Alberta? Like, is. Yeah. How's it been going?
[00:03:03] Speaker B: Well, I attended a weather forecaster last March that said that we were moving out of a El Nino into a La Nina.
And I think for some parts of the country, that has been true, but for the Lethbridge area, it's been surprisingly untrue.
[00:03:23] Speaker A: Nice and. Nice and warm.
[00:03:25] Speaker B: It's. It's been. Yeah. Other than about a week and a half of cold that we had in November. We really didn't have any snow in November or in December. Sorry. Yeah. And you know, currently today it's 9 degrees here in Lethbridge.
[00:03:41] Speaker A: Yeah.
[00:03:42] Speaker B: With, with no wind actually, either, so.
[00:03:45] Speaker A: Oh, very nice day.
[00:03:47] Speaker B: So. So I don't know what'll happen from here, but, you know, we're, it's supposed to get cold next week. Some lows of minus 20.
Is that enough to get the cattle eating more? I, I don't know.
[00:04:00] Speaker A: I was going to say, like, when, from a weather perspective, like, how does it impact, you know, your, your business or what you see? Like, is it as simple as nice weather, cattle eating less, less demand? Like, is that in a nutshell?
[00:04:15] Speaker B: I would probably say it's not even really about the cattle eating too much more or less. That's probably a secondary thing. But yeah, weather sure plays havoc on logistics.
[00:04:26] Speaker A: Right.
[00:04:26] Speaker B: And so when you're scrambling, you know, oftentimes that's probably in the, in the farmer's favor when, when guys are scrambling, they can't get loads in, that sort of thing. More so than I, I do think that the cattle do eat a bit more, that's for sure. They need to expend a little more energy for keeping warm, but I don't know if that's quite as major myself. Anyway, I'm not really sure.
[00:04:52] Speaker A: Yeah, fair enough. Okay, so I got a couple of questions for today. I thought we could, we could cover the flavor of the month here with the tariff talk out of Trump in the US obviously. Inauguration, we're recording this on Wednesday the 15th, inaugurations on the 20th. So I thought we could talk about that. I see the corn market has rallied quite a bit in the US So any implications for Canadian barley or something? Around that. And then also just what's keeping you kind of busy right now is moving and shaking out there from a feed grains perspective. So out of those three, where do you want to start?
[00:05:35] Speaker B: Well, everyone's definitely talking about the tariffs. There's no doubt about that. It's what started as a rumor has now really become mainstream. I mean the premier basically kind of came out and said that they're coming.
So we know exactly what that means for sure. But we, we know that. We know that they're coming. I lost my first, my first trade to the tariff today actually. So really on about 500 ton of Durham to go down to the States for April May. Yeah. And the second that we. Everything was ready to go, prices, everything were, were all worked out. And second that we tried to bring the tariff up to the buyer. They basically said that there will be no portion of our contract that will be renegotiated. There's. There will be no voiding all these types of things which we just can't agree to. $25 price move is just too much to withstand on that. So they were very much so. Essentially got kicked down the road till next week till we see what happens with it. So already kind of starting to see that uncertainty take effect in the market, which is quite unfortunate. They would have, you know, they can't find this particular thing down there. So I think eventually they would have to come to the table. But.
[00:06:57] Speaker A: Right.
[00:06:57] Speaker B: Quite disappointing. Anyway, cattle guys are also very standoffish right now. Obviously a lot of cattle. Well, the calves come up from the States. They get fed here and then a lot of them go back down to the States.
[00:07:10] Speaker A: Okay.
[00:07:11] Speaker B: So a lot of them have.
Are really on hold.
Surprisingly, it's tricky to sell barley. Like we've seen corn rally up really strong. Like the, the price that corn probably should be in Lethbridge is around probably 330 to 340 at. On based on what the historic basis has been at this time.
But there were companies dumping it Yesterday at around 305 just to mitigate some of this risk because they don't know what's coming on with tariffs and stuff like that.
[00:07:47] Speaker A: Yep.
[00:07:48] Speaker B: So that by and large has kept barley in and around 290 to $300 a ton in Lethbridge here.
[00:07:57] Speaker A: Okay.
[00:07:58] Speaker B: Yeah, a little bit trades over it. A lot of offers are over that level but. But very little trades over those. Those levels.
[00:08:09] Speaker A: So your, your feed buyers, they're. They're quiet right now.
[00:08:15] Speaker B: They're very quiet, yeah.
[00:08:16] Speaker A: Waiting to see what. Yeah.
[00:08:17] Speaker B: The thought of them buying cattle at 69 and with a 69 and a half cent dollar out of the states bringing up here and then getting tariff selling them back into the states. I mean, you know, it doesn't.
[00:08:30] Speaker A: Doesn't pencil.
[00:08:32] Speaker B: Yeah, you're getting it coming and going. Right. So I did hear this is a breaking exclusive for you, Ryan.
[00:08:41] Speaker A: Hey, there we go.
[00:08:42] Speaker B: I did hear from one of the larger feedlots that I privileged to deal with that they have a lobbyist kind of in or they have a connection to a lobbyist out in Ottawa.
[00:08:57] Speaker A: Okay.
[00:08:57] Speaker B: And they said that the, the retaliatory tariffs that we have to go just depending on what actually gets put in place there on early next week are on so far, not a lot of agricultural products.
[00:09:12] Speaker A: Okay.
[00:09:12] Speaker B: So he said orange juice, bourbon, wine.
[00:09:21] Speaker A: Yep.
[00:09:21] Speaker B: And pet food.
[00:09:25] Speaker A: Alrighty.
[00:09:26] Speaker B: So those are some of the. The apparent potential retaliatory tariffs that Canada has ready to go as a rule.
[00:09:38] Speaker A: Well, I, I am well stocked on bourbon right now myself, so appreciate the tip. And my wife did go to Costco today and Costco Liquor, so I think we're well stocked on wine now as well. So there you go. We're getting ahead of it over here. We're saving money.
All right. All right. So not. Not gonna be. Not on corn yet then, is what you're saying. Not on corn. All right.
[00:10:04] Speaker B: And then you gotta remember, you know, with these tariffs, it's a funny thing because if you think about it, most likely the commodities still need to move around. Let me see if I can get my lighting back here. I think this thing doesn't pick it up very well.
[00:10:18] Speaker A: Comes and goes.
[00:10:19] Speaker B: Yeah. But if you remember back to when China was not accepting our canola, Canadian canola still went China.
[00:10:28] Speaker A: Yep.
[00:10:29] Speaker B: It just went in some other way.
[00:10:32] Speaker A: Yeah. It had another destination first or some paperwork.
[00:10:36] Speaker B: Yes.
I think that's important to remember those types of things. And you see that with. I see it happen very often where if the US has a tariff on a product, somehow it will find its way up to Canada and get exported the same place anyway.
[00:10:55] Speaker A: Yeah.
[00:10:57] Speaker B: So it seems to me that. I know, of course that can't happen with everything, but the commodities seem to flow, but the price levels will get affected and we don't know exactly how all that will work out. I've heard some huge numbers for our GDP, that it could affect our GDP to like 2.4% and put us right into a recession.
[00:11:19] Speaker A: Yeah, I read some. Some of those as well.
[00:11:21] Speaker B: Yep. You know, collapse of the Canadian dollar further. So.
[00:11:25] Speaker A: Yep. Yeah, well, I've been. I've been looking at crops, you know, crops that we rely the, you know, on the US like, heavily for movement. And, you know, like, oats is one that kind of stands out for me. And I just wonder in, like, the oat market if, you know, to get other oats, the US Is going to have to go quite a bit further to go and find those. Right. And I just wonder if that kind of gets passed down to the consumer and the disruption maybe isn't as. As aggressive. It just kind of figures its way out and. And it isn't as bad. I guess time will tell. Durham. The first three months of this year, 10% of our. Durham's gone to the U.S. so, you know, when you said that one to kick it off here, that definitely caught my attention. And hopefully short term and next week, you know, you can get your deal done and move on. Right. But that's. Yeah, that's really, really interesting. I know I keep asking everybody if you know the answer of what's going to happen and can give me six months of guidance. I would be forever grateful, but have not found that quite yet. So.
[00:12:35] Speaker B: Yeah. Yeah. Well, it's a. It's a strange thing, too, because it's. It's so unexpected, like, here. We've always been a great trading partner with the US that we haven't really put measures in place to all of a sudden fight them. You know, it's kind of like. It's kind of like if. If you believe that you're in a good marriage, and then all of a sudden she comes home one day and says, hey, we're getting a divorce. And you're like, wait a minute. I thought, you know, we were okay.
[00:13:03] Speaker A: Things were good.
[00:13:03] Speaker B: Yeah, I'm taking everything. Right.
[00:13:07] Speaker A: So.
[00:13:08] Speaker B: So.
[00:13:09] Speaker A: Oh, man. We're going to clip that. I think we're going to clip that one. That might play a few times. David, that's awesome. Yeah, you know, I saw today, you know, we have a $1.3 billion plan on securing our border and things like that. I. I don't know. I don't know what that all looks like, but I guess we will learn each and every day here next week.
All right, folks, I want to go over my positive moments here for the week. Well, we. We did celebrate Finn's birthday and. Poor guy, you know, kind of down and out for the count. Both him and I have been just suffering through this cold. I know many of you have been suffering through it as well, but it's a bit of a Doozy. And so the poor little dude couldn't do all the birthday party stuff. But he's two years old now. And, you know, we. We opened up. He opened up his presents and he got a couple of John Deere tractors. And you may have seen the video as well. I did throw it out there, but it was, you know, to open up that present and he's just like, tractor, tractor, tractor. Just so pumped. It was, it was great. So we had a great birthday even though we were under the weather. Other positive moment for me is I'm sure many of you have that honey do list, right where your partner like my house. My wife has. She has a list of things that she would like done in the house. And my wife's birthday comes up here in January as well. So I always like to get a little something done on the honey do list. It's just like, oh man, what was the oldest one or the most important?
And you know, can I get that done here before the birthday? Just a little gets me in the good books just a little bit, you know, and gets off the list. It gets. The next thing gets added right behind it, but whatever. So I got the pot lights. You know, our house is, whatever, 20 some years old and, you know, the pot lights, I don't have to explain it, but did replace them with some LED lights. Got that done. It's like 99% done. I just have a little tweaking to do and so that's good. That was. Felt good. Nice to get something done too, right? That's been kind of lingering. So. So that felt good this week. So that was another positive moment. And then, you know, from there, I would say when it comes to crop marketing, you know, I've been chatting with a few folks in the space and there has been a lot of, like, I don't want to say panic out there, but it's tense and I just, I don't. I don't know why I don't feel that tension from the growers that I've been working with. So I feel like that means that we have executed a plan to date and that we have the right steps in place for. For what's to come here. It's never perfect. You know, I've never met the perfect crop marketing plan yet.
But, you know, when you can kind of sit here and say, yeah, whatever's coming our way, we. We have the plan or we feel good heading into it, that's positive. I'm going to take that. So that's. That's going to be my positive moments here for episode 59. All right, folks, so for what's cool in crop marketing here for episode 59, obviously we have the inauguration coming up momentarily here. If you're listening to this prior to January 20th, and there's a lot of. It's like one of those things. There's. It's. I have the opportunity, I chat with a lot of people, right? And there is just.
Nobody knows what's going to happen after January 20th. It's one of those situations where, you know, when you're staring it down and you're looking at it and you're like, you know, tariffs, 25% tariffs on Canadian goods that are traveling into the US that's not going to be good, right? You sit there and you say, I know, I know that. That is not going to be good. But then you sit back and you say, well, out of the entire list, out of the. What was it? Oh, man, I had some of these numbers down earlier. If you're watching on YouTube, I'm fumbling through some sheets here to try to find some numbers, but I. It was four. Between 400 and $500 billion worth of. Of annual trade.
So then you sit here and say, well, what happens if canola oil is not on that list? What happens if Trump comes out and says, hey, it's gonna be. It's gonna be aluminum and it's gonna be, you know, whatever. But grains and oil seeds aren't on it. What happens, right? So you sit here and you say, man, like, if they don't put a tariff on this, like the, you know, on canola oil, for example, the basis levels have been getting better, futures have climbed, supply is tight. In Western Canada, you know, you'd say, there's upside here. But then the tariff comes in, for example, on canola oil, the market sinks, and you sit here and say, geez, what was I doing? Why didn't I do anything? You know, I saw this coming. The date was on the calendar for months. Why didn't I do anything about it? It's hard, right? It's tricky. It's tricky. It's hard. It's not easy. I know. Even my. For myself this week, my head's been spinning a little bit because I. I follow some great smart technical traders as well. And yet in some of those, some of that analysis, they're talking about upside here in soybeans and canola, right? So my head's been spinning a little bit this week and trying to sort through what, what this could mean. And I'VE been looking back 2017, you know, what happened when Trump was inaugurated January 20th as well, 2017? Well, the US dollar drops, right? Drops. I don't have the exact numbers in front of me. I, I looked at the charts last night. But, you know, the, the, the US Dollar drops and it drops. I can't even guess right now, but, you know, significantly. And what's that good for? Well, it's good for wheat futures, soybean futures, corn futures. Right? Like that's a good thing for futures. Crude oil climbs, and I think that one went from $52 a barrel to 75. And I know a lot of farmers reaching out to me, asking, well, crude oil, it's got to be our diesel prices. They have to be climbing with all this going on. Do we buy before January 20th? And in my mind, I'm like, well, why then why would the premier of Alberta go all the way to Florida and then come back upset about the discussion with Trump and tariffs? You'd have to assume that if you're upset and you're, you know, the province I live in where, you know, obviously a big oil province, you'd have to be upset thinking that oil prices are going to decline. Right? You wouldn't be coming back upset if oil prices were climbing. Canadian select oil prices climbing. So we'll see. I, I don't know why, to me, I don't know why, why diesel prices would go on a tear here. But hey, if you, if you have the answer out, send it over. Appreciate it. So, you know, that's kind of the big thing back in 2017. This is different.
This is much different. And so I sit here, I'm like, does Trump want the US Dollar to drop? Yes.
Does he want crude prices to drop? Yes.
You know, can he accomplish that, though? Can he accomplish that? U.S. dollar dropping?
We will see, right? We will see. So we have this entire list of stuff that could be, could have tariffs placed on it. And then so I started looking at, you know, some of our commodities and I'll get to very shortly, I'll get to a point here with a solution for you. But when I look at, SO wheat, for example, and I just took the last quarter, so maybe not the best analysis, but just to give perspective, at least a little sliver of perspective in the last quarter here, August, September, October, those are the months the US Took four and a half percent of our Canadian wheat. Okay, four and a half percent tariffs against Canada, I would expect the Canadian dollar is going to decline. We'll see. Four and a Half percent of that wheat can go elsewhere. I'm not too worried about that. Lentils, 2%, not that boric P is 3%. Right. Again, not a big deal. Canola seeds. 0.7% of our canola seed goes to the U.S. not a big deal. But then you get to Durham. 10% of our Durham goes to the U.S.
okay, interesting. Right. Maybe some concern around that when it comes to tariffs. Let's jump over to flax.
95% of our flax in those first three months went to the US big, really big number. Now I sold flax the other day. It was not going to the US it was going to Southeast Asia. Okay? So again, I'm not giving you like years of data and I'm just trying to reference this for you in the short term. Mustard. 97% of our mustard went to the U.S. what else we got here? Oats.
80% of our oat exports went to the U.S.
right. That's a big one. That's a big one. Now when I look at oats though, tariffs, some of those costs can be passed on to the consumer potentially as well. Right. Or the market has to adjust or less margin or costs pass on to the consumer. And I think oats could be one because when you look at it, the US produced, I don't know, 900,000 ton of oats. They are gonna buy a million ish mill, 1.1, 1.2, 1.3 from us, you know, to go and find that elsewhere. And we have a plenty the way it looks to go find that elsewhere. It's not as easy. You can go find it out of Scandinavian countries, but you know, there's a bit of a freight bill there. So I just wonder if that one, I don't know if I'll be wrong and be completely damaged market, but I just wonder if that one kind of gets passed on to the consumer. We'll see. Right. And then rye. 100% of our rye exports went to the U.S. again, I'm just referencing those for three first three months. Okay? So it's not perfect. It's not perfect analysis, that's for sure.
So anyways, some risk here, some risk in some of these crops for January 20th. And tariffs, we don't know. We don't know. But the important thing is here is you don't have to know. Okay? You don't have to know. You can.
I've never been the smartest person in a room before and I never will be. Okay? And while everything spins, don't forget that you could keep it simple.
All right, you can keep it simple. Now, you know, canola and spring wheat, kind of our big ones, anything traded in the futures market, this makes it a lot easier. But even let's, let's even look at oats, for example. Let's say Trump puts a tariff on oats.
So the US sits there and says, holy smokes, now we don't have enough oats. We got to find our oats from somewhere else. What do you think oat futures are going to do in the meantime? I'm going to guess that they're going to go and climb in that situation because, because supply is now being taxed at 25%. Like I would assume futures are going to climb in that scenario, like in okra or in Western Canada, you could say, oh man, I, all I can get is 450, but I'm worried about these tariffs and then go and buy some old futures or buy some call options and, you know, participate in that. I don't know, pardon me, I don't know if that's what's going to happen, but it's interesting, right? But like canola and wheat are big ones.
I'm not that worried about wheat overall. You know, last week we talked about being bullish basis. Maybe that takes a bit of a hiccup for in the short term. But again, the Canadian dollar, where does that go if it pulls back? Again, I'm not as worried about wheat. Maybe that'll be my fault or my issue or my Achilles heel yet this spring. Time will tell. But if you were, if you sat there and said, well, you know what, I'm going to take $8 for my wheat, great, you can set a floor and participate in some upside. You can say, yeah, I'm going to take $8 for my wheat because I don't want to go through the experience of whatever happens with tariffs. And I know that I can participate in upside. And that's what I want to tell you folks, is that you can have scenarios where you keep it simple, take the stress off and you just lock in worst case scenarios.
Maybe it's not as exciting, maybe it's not as, you know, not as sexy by doing that. But you can go and just say, hey, I'm going to take some floors here, I'm going to not worry about, take the downside risk off the table, not lose sleep over downside risk, and instead I'm going to sit here and just focus on how do I capture upside if next week, January 20th, there's no tariffs by the end of the week. No tariffs on Canola oil. The Canola market finds reason to rally.
That's what I'm going to focus on. Focus on trying to capture that moving forward. Because you can do that.
It's very simple to do that. There's elevators. You don't even have to have a brokerage account. You honestly, you can't set one up fast enough right now. You could never set one up by January 20th, it wouldn't happen. But you could say, hey, pardon me, I'm going to go and lock in some worst case scenarios with a company that allows me to add some type of tool to participate in upside.
Like I said, maybe not sexy, maybe not that exciting, but simple. Simple where you don't have to stress.
Imagine you're farming in western Canada and you sit here and you're looking at your cash flow planner and you're saying, man, you know, I need to generate a fair amount of cash by February, whatever, and by March, whatever, and April, whatever. You sit here and say, man, I need a lot of money. In these three months.
You do nothing, Trump comes out. Tariffs get slapped on stuff that we weren't expecting or it's worse than what we thought, or it's reality. Maybe that's the worst case scenario. It's actually reality. And now you're chasing, now you're chasing a market that is not highly profitable to start with, but you need to generate this money and you're not chasing a loan. You weren't the only one, right? So there's a group of people out there chasing. It gets ugly and it's those scenarios that happen, you know, every once in a while. Well, even look at the Vitera bid. They didn't have any bids after May of 2025. You guys saw this, right? And so like I'm looking at it the other day and I'm like, is that tariff related? Like, that's interesting. I wonder if that's tariff related. Now we all know it wasn't. It was, hey, we got the approval to sell to Bungay, right? So that's what it was. But I messaged my Vitera buyer and he listens to the show and I was like, hey, what's going on? He's like, oh, we just don't have demand that far out.
I'm sorry, man, that was a little stinky. That, that one didn't make sense because other years where you don't have that much demand, you still had bids out there. So anyway, I'll forgive you for that one. I get it. You can say that, hey, the Bungee deal's been greenlighted. I get it. So. But that's what it was. But what happens is you can get no deliveries, no, no months that are sold out where you can't sell. And, and so there's going to be, as a buyer, if a tariff comes on, there's going to be those moments where they're like, oh, imagine a, imagine, you know, heaven forbid, flax. A tariff hits flax. Well, now the buyers sit there and say, whoa, I'm not buying anything here. Like, I still got flax to move. I gotta find alternative markets. Whatever. You can't move it, right? At least temporarily. You know, I'm not saying that'll happen with canola oil or with Canola, but it happens where you get a big geopolitical. Whatever happens, you can't deliver and it sucks. So now you're chasing cash flow, you're chasing scenarios, trying to get stuff moved so you can, you know, pay the banker. And I know some banks might say, oh, don't worry about it, you know, we'll extend you a little further. But that's not pleasant and it's not free or cheap. And so you can get ahead of this though, folks. You can get ahead, lock in worst case scenarios on anything that is traded on the futures markets and then just figure out how to participate in that upside.
Yeah, you can't do it with peas, you can't do it with Durham. Like it's trickier, but you can do it and you can figure it out. All right? I don't know what's going to happen. I wish I did. I'd be a hero if I knew what was going to happen. All I know is keep it simple. Don't overthink it. Focus on your plan. When do you need money, what's profitable? How are you going to align those? And don't be chasing and I know, I don't know, I just have this weird feeling that it's going to be a tough little run here. Just be prepared. And if it isn't, if it isn't a tough run, then you've sold something a little too cheap.
But you can fumble the upside. You can figure it out together, okay? It's positive. How do I get more money now? How do I participate in upside? In the wheat market, in the Canola market? Whatever it is, you can do it. All right? You can do it. That's all I want to say.
Other than that. From a tariff perspective, you know, it's, it sounds like it's had a pretty significant impact already. Like you know, any time you have a pause in trade waiting that the impacts are already happening. Right, right. Lack of trade, lack of flow and you are already seeing an impact. You know, I, I was going to say from a corn perspective, you know, have we seen a significant volume of corn coming up into Canada this winter? Like is that kind of just continued on, you know, similar to last year or what are you seeing on that front?
[00:32:21] Speaker B: Yeah, it's been quite significant. And just incidentally, corn and DDGs so far from that same source are supposedly not going to be counter tariffs at this point.
[00:32:32] Speaker A: Okay.
[00:32:33] Speaker B: Which I don't know if that's a good thing for the, for the Canadian farmer on that, on that point. But you know, when, when was it here? I think in about December I read a Greg Costell report and he was estimating that with, you know, the barley crop that we had this year and everything, we probably still needed to import about two and a half million pounds of corn into southern Alberta. So I don't know if we're quite going to get there. There is still a fair amount of corn trading. Like I was surprised just this week how much corn actually I would call it getting dumped on the market. It traded much lower than, than where it should have been. You know, most of the time your, your basis levels are quite a bit higher. Like it was probably a 20% drop in the basis level that the seller took on I would estimate.
[00:33:26] Speaker A: Okay.
[00:33:27] Speaker B: I think just to get some moved and on the books in case of whatever.
So yeah, I mean it's definitely still coming in. There's been industry changes down here that I think are important for the producers in southern Alberta producers to be aware of and that is that, you know, a lot of these guys have put in steam flaking facilities now. Millions of dollars of steam flaking facilities. And, and you know, when these guys steam flake this corn, it, it's quite valuable. Like they can pay a fair amount over like it's, its value is about 113, 114% barley, whereas when it's not steam flaked it's about 95%.
[00:34:14] Speaker A: Okay.
And that's a process just that happens just on corn?
[00:34:19] Speaker B: Yes, well, well I suppose they could, they could probably do that barley as well, but they don't. Yeah, it's more for, it's more for corn. It just, it really, I don't think the barley, it would be as, as effective on it. You're more just trying to get right to that, that starch and yeah, so I've seen. And that's continuing there. Like, like from what I understand, there's going to be another two facilities, another. Well, another two feed lots that have these steam flakers coming online here. It's supposed to be in April, May. We've seen, you know, late lakeside, like large operations move entirely to it. So every little thing kind of, it kind of hurts our local feed grain industry, which I don't, you know, I would rather not see.
[00:35:08] Speaker A: Yeah, for sure.
[00:35:10] Speaker B: It, it lends itself to the big commercial elevators and people like that to be more in their favor in that trade.
[00:35:19] Speaker A: Yep, yep. Okay. That's something I definitely didn't have on my radar. So that's. Yeah, that's good to bring up.
So let's keep talking about, you know, we're, we're the middle part of January here, 20, 25 like you said, maybe a little quieter lately, but is there any crops they kind of stand out here with a bit more, bit more trade, a bit more action, a bit more excitement around them?
[00:35:44] Speaker B: Yeah, well, I mean I would probably say that your deferred months, like your April, May, June, July is what's on most people's radar. If they're going to be buying anything selling like January barley is really tricky. Wheat, it's probably fairly steady. I don't know if there's a real standout at, right at the moment. A lot of guys are just quite, quite on, quite on hold. It's been, you know, quite a slow week. A bit of a grind somewhat because of these tariffs. But the other thing is like your, your yearlings that came in in September are all about ready to go out.
[00:36:24] Speaker A: Okay.
[00:36:24] Speaker B: And then guys are. I don't think they will be filling up as much either. So yeah, a general slowness in February going into it. I think that'll be more pronounced this year just across, across all feed grains. Like, like I'm having to spot sell and really, you know, take a bit of a hit on corn and wheat and barley if I want to get it moved this week.
So it's. So it's kind of across the board, you know, as far as other commodities that look promised. I'm not too sure. I haven't had a chance to really look at a lot of. Like there's anything that's a standout. Right now. I'm, I'm not sure.
[00:37:08] Speaker A: I think, you know, my standout is when I started to pencil back some new crop feed barley values, you know, some of those were, were at profitable levels in the scenarios I was reviewing. So I, I was pleasantly surprised that those opportunities were starting to present themselves. So even one farm, we were running through scenarios and that feed barley offer, they got penciled better than the wheat scenario. And the wheat scenario, we were, we were massaging a little bit like we were making it look better than what was actually out there we were trying to forecast. Whereas the barley was put ink to paper. Right. So I was pleasantly surprised. I know I chatted with a few growers about feed barley and just say, hey, like if you're at break evens or above here, take a look. Take, take a look, take a peek, see what.
[00:38:02] Speaker B: Yeah. Oh, I can't disagree with that. Yeah. If you're going out to new crop, like, yeah, that I, I can't disagree with you there. Because the new crop, barley is essentially trading at about the current price of barley right now.
So definitely, you know, that's definitely something to look at as well. I, I think that's got a pencil in for sure.
[00:38:24] Speaker A: I think for a bunch of folks it does pencil up pretty, pretty well. And even I got a few malt offers and I was like, me, you know, the malt prices wasn't really that exciting to take on that risk, so.
[00:38:37] Speaker B: Right.
[00:38:38] Speaker A: Yeah.
[00:38:38] Speaker B: Especially if they, I mean, especially if we do kind of run into that scenario where we do get into this initial strong trade war, everything slows down, guys don't bring in as much cattle. These new crop numbers could look really good in a month or two from now, actually. Yeah.
[00:38:54] Speaker A: And I'm very happy if these first sales don't look that great because of where they're at. They are still pretty darn good.
[00:39:01] Speaker B: So.
[00:39:01] Speaker A: Yeah.
[00:39:03] Speaker B: Yeah.
[00:39:03] Speaker A: If it wants to keep climbing, I'm all for it. I just think it's a good level to start at, so. All right, David, well, I definitely appreciate you jumping on the show here. Are you guys going to be at any events, any, anything on the radar? Any shows on the radar? What do you got here in the next month or two?
[00:39:19] Speaker B: Well, we do have Ag Expo coming up. That's the next main one here in Lathbridge. I suppose we do that every year.
[00:39:26] Speaker A: Yeah.
[00:39:27] Speaker B: I don't know the dates of Ag Expo just off the top of my head, but it's usually.
[00:39:31] Speaker A: I don't know either.
Yeah, I'll Google real quick here.
[00:39:36] Speaker B: So we'll be doing that show and, and yeah, that's really the next one coming up that we'll be involved in.
[00:39:43] Speaker A: Yeah. Egg expose, February 26 to February 28. So right at the end of the month there. Okay. All right, man. Sounds good. Thanks for your time. Appreciate it.
[00:39:52] Speaker B: You bet. Thanks, Ryan.
[00:39:53] Speaker A: Take care. Yeah, you too.
[00:39:55] Speaker B: Okay, bye.
[00:40:00] Speaker A: So I want to give a big shout out here to show sponsor John Deere. And they got a lot going on over at John Deere these days. It's been busy the last week or so. And of course you've heard me talk about connectivity, you've heard me talk about JD Link and John Deere Operations Center. But I want to just take a second here to talk about harvest profit.
And Harvest Profit is a financial planning software tool. It links, connects with John Deere Operations Center. So what I mean by that is data entry is a little bit easier if it's in your JD Ops. It can sync with harvest profit and come across. I'm talking about land locations and things like that. I know farms, you know, you look at some of these platforms and the data entry involves. It can be a little bit burdensome. But it's very quick to set up a farm when it comes to harvest profit, especially with JD Ops in the background. And I just, with everything going on here in 2025, I can't talk about this enough how important it is to have those numbers down, to have a place of truth where you go back, review, update, and just have that plan in a spot. All right. We use it on our farm for cost of production, tracking contracts. We want to get better at it in 2025.
And I think everybody does. I don't think it's just us. I think a lot of people do as well. Harvestprofit.com check it out. Honestly, if you want to sleep a little bit more, sleep better at night, having it down, that's one of the steps. All right, so again, thanks, John Deere, great show sponsor here for what? The futures podcast. All right, let's get to eating your veggies here for episode 59. Of course, because it's the right thing to do, right? You got to eat those veggies. All right, Action oriented items.
Fall 2025 bids number one. Fall 2025.
There are pricing opportunities, especially crop production show in Saskatoon. This week's always one where things kind of spark up. Like green peas went from $12 to $14 this week.
You know, was the 12 a number that had, you know, a lot of action, excitement? I wouldn't say so, but 14 was out there. That's a pretty significant move, right? We're talking 15% or something like that. So pretty good move there. But now for your farm, like there was malt prices, I'm sure lentil bids were updated, Durham bids are updated. Lots of the specialty crop stuff was updated. You know, take a peek out there. I know plans are starting to get baked a little bit more. I know crop insurance is going to be a big part of that. Oh man, can't wait to talk about crop insurance. And I would think we'll be talking about some values here in early February on the show and I don't know, maybe I can find a pretty cool guest to talk about it. We'll see. But crop insurance will be front and center here and I know that's going to dictate a lot of plans too. But now is the time, you know, take a look at more of those bids, maybe do your own crop rankings calculator and figure out your, you know, that path to profitability here in 2025. Okay, second one.
You know, have you taken the time to just think about your plan, your crop marketing plan?
If these tariffs are implemented, what steps are you going to take?
Because what, what, what can happen here is you can get a little bit frustrated, maybe get mad, get a little emotional.
So let's say you didn't do anything this week. The Trump administration inauguration happens and Trump's slapping tariffs on here on Monday, Tuesday, whatever it is, and you haven't done anything, you're going to be mad, you're going to be upset and it might lead to a poor decision.
So what steps are you going to take when you work through those emotions next week?
If you can today just take a moment to think about it and to write it down.
What it could be is that you might write down one sentence and it by might be, regardless of what happens next week, I will not overreact and I will do nothing.
Okay? I'm not saying that's the right thing to do, but it might be better than a knee jerk reaction decision, okay?
And it'll get, it's going to get intense. It could get intense, could get wild volatile, it could get stressful.
And so just kind of sit down and write it. What is your plan? What are you going to do if tariffs, if Canada is left with tariffs next week, what are you doing? What's the plan? Write it down. And hopefully that guides you a little bit better here. And then the last one, you know, I would say I wrote down do not bury your head in the sand. Okay?
And so you're like, well, Ryan, you said one of the action plans could be not to do anything.
Isn't that burning your head in the sand? For a week maybe. But what I mean by that is, as you go through this and you go through the analysis and you go through maybe it's probabilities, you know, don't just sit here and think that the. It's just going to fix itself. Okay? And so, like, what I mean by that is, you know, early in the episode here or throughout the episode, just talking about, you know, controlling that destiny here, just, just a little bit more. And like I said, maybe locking in some floors and keeping some upside open, like, just don't walk away from it. Don't get mad and walk away from it. Like the I'm sure we'll hear in the next couple weeks, like, I'd rather throw it in the ditch or burn it than sell it for this price or whatever it is. Don't, don't be that far right. Don't bury your head in the sand. Don't make comments like that. You know, you're a business owner. You know, prepare yourself for, for events that impact your business and be calculated. Don't bury your head in the sand. All right, okay. Let's leave it at that. For eating your veggies on episode 59, thanks again for hanging out here with the what the Futures podcast. I hope you enjoyed the show. Send me a comment, send me a message, email me whatever you got.
Everything's open. Again, appreciate you sharing it with a friend. We have seen a really significant bump in listens here, the last number of weeks, last month or so. And thank you, thank you for hanging out with me. I hope, I hope this helps your farm in some way in 2025. And I hope I didn't get it all wrong because these episodes live out there. They don't go away. I get. I'm getting hate mail from. Not hate mail, but I'm getting messages from people that are like, this guy's an idiot. Look what he said. I look back, I'm like, yeah, that was seven weeks ago. And actually what I said was correct. And we've made different moves since then. We've took advantage of that scenario and we've moved on. But this stuff lives out there. So hopefully my what I've said isn't off by too much. So thanks again, folks. I'm Ryan. I'm out. Have a good week.
