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.
Hey there, and welcome to the what the Futures podcast, recorded in the UPL studio. Here we are, folks. Already the month of May. Can you believe it? Great month across the prairies. This means that we are kicking off eight weeks of giveaways with UPL starting this next week here. So check it out. We're going to talk about it here a little bit later on in today's episode, of course, what the Futures podcast is your weekly dose of clarity in the complex world of agriculture. And I know today I'm going to.
I'm going to cover some of the complexities. I think that's a word around, you know, grain buyers. I've got. I don't want to talk about it anymore, but we're gonna talk about it today, of course. I'm Ryan Denis. I am the host of the what the Futures podcast. I've spent my career working with farmers across the prairie provinces. I was a grain buyer, a grain marketing advisor, an analyst, led a team of advisors in Canada and the US. And of course, I'm. I always say farm kid, but I'm. Jeez, I'm gonna be 40 years old. But anyways, I grew up on the farm in Dormy, Saskatchewan. My dad and brother still actively put in a few acres there as well. So this week's episode, episode number 25. Now, I'm excited. I'm excited for this show for a couple of reasons. Number one, we have a bit of a new setup here. It's so new that the camera has now, like, switched spots, and I need to even, like, focus on a new spot to look. So this is episode one with this new setup. We've got a new shot of the studio as well and some great guests here. I've got Holly Dirksen with UPL joining me later on. We did have some technical difficulties, so hopefully, fingers crossed we get it in here. If not, it'll just be me. And then I've got Chuck Penner, of course, he's been on multiple episodes. He's joining us for a bit of an update here. We haven't chatted in a while, so. Yeah, there's a little bit of length to that one. Lots of good topics here to cover with, with Chuck. But before all that, I'm going to have to take five minutes, maybe ten, hopefully five.
But I want to talk about how as growers across the prairie provinces, you can protect yourself or attempt to protect yourself against this death spiral of buyers that are in chaos, trouble. I don't know what to call it. I don't want to talk about it anymore, but I have to so that I can sleep at night. And, of course, we'll get to our regular segments, including the popular mailbag segment, which just exploded in the last week. So thank you to everyone that asked a question. There's some great ones in there about fertilizer, wheat futures contracts, some really good ones. So stay tuned for those. Of course, the popular mailbag segment brought to you by pioneer seeds. We also have a bag of seeds to give away today. And of course, we'll wrap it up with, with a healthy serving of veggies because, of course, it's the right thing to do. And that's when I give you a few pointers on some things I'm watching that you can also watch and execute on for your farm business. All right. Could be crop marketing. You've seen them, you've heard them. There's a bit of a variety out there, so. All right, so before we get too far down the episode, I do have a quick word from our sponsor, John Deere. You know, out here in western Canada, we see a lot of different crop conditions. Fortunately, our friends at John Deere have a whole new lineup that can handle any crop in any condition. There's three new high horsepower nine Rx tractors, a new high tech s seven and x nine combine, and there's even a new C Series air cart. Check them out for yourself at John Deere, CA, and see what's coming our way this year. I was actually chatting with the folks over at John Deere this week, getting a little pumped up for egg in motion. We're going to see a lot of this equipment for the first time here in Canada. So that's exciting. So anyways, folks, let's get after it in this episode. Of course, we start each episode with our positive moments, and this is going to help just get my blood pressure down before it rises in my next segment.
But my meme, my grandmother, I'm french, so my ma, she's 79 years old. Okay. And a couple years ago, I don't think it was last year, I think it was the year before she went out and bought a garden tractor with a tiller. Okay. She lives in Waka, Saskatchewan, just north of Saskatoon. She's got a beautiful little plot of land there on fourth street in her backyard. Her garden, right? Or wonderful garden. And, you know, they had to walk behind tiller forever. My grandfather, my papa passed away a number of years ago. Anyways, she decides that she's going to go buy a tractor for. To till her garden and she's gonna learn how to drive this thing at the age of like 77, 78, 79 now, right? And not just like put it in the dirt and hit the pedal and go like, this is a gear tractor that she's driving. It's a little bit bigger. And it is fantastic to watch her till her garden. I'm sure she's gonna till it, I don't know, probably a dozen times because she's having so much fun out there. But to see somebody, you know, in their seventies, late seventies, learn something new and go and tackle this, like, for us as grandkids and even my mom, to watch all this is pretty neat. She's got a lot of gumption, she's got a lot of spunk, and, yeah, she's not slowing down a little bit. So that's one of my positive moments. My mom sent me a video of her, of my mouth till in the garden. So that was fun.
My second one of the week, I got to Wilhelmina started soccer this week on Sunday. This past week, I give kudos to coach Bailey that's trying to wrangle up all these three and four year olds. And in the first day, I thought it was going to be just kind of practice and stuff like that. But coach Bailey had them put on yellow and red, you know, pick their. Their shirt or whatever goes over their shirt with the jersey thing and attempted to have a game. Now, it lasted about two minutes, and then they added two more nets and four more balls, and away they went. I was impressed by what I saw out there. And of course, Willa got a yellow jersey, but yellow looks like mustard. And in our family, only me, only dad likes mustard. So she was quick to go and make a trade. She's already been traded to team ketchup, and she got the red one in about 10 seconds after the yellow one. So. So, yeah, it was a lot of fun. Soccer was a lot of fun this last week. So that's what I've. I've got for positive moments. Now, of course, we get to our hot topic next. And our hot topic should be probably talking about the CNCP rail strike that can start here on, what, may 22, like three weeks from now. It's probably what I should talk about, but I don't know, that's.
We'll read about it in the news, right? You guys all know that, and you'll see it so, my hot topic, I've got to go back to this at least one more time, but I'm getting a little pissy here about slow payments and some of the stuff going on across the prairies. And I hope I don't need to talk about this all summer long, because if you're listening to this, it's a good chance you already know some of the background. But I'm extremely frustrated. Okay. And I'm extremely frustrated that I need to actually spend time talking about this on today's podcast.
We're here talking about this because farmers are not getting paid for your grain according to the terms and conditions on your contract. Okay? So I spoke to a bunch of people here over the last week. Sadly, most of it can't be quoted or, or repeated word for word. And frankly, I'm a little bit torn here in the situation that I find myself in, in the predicament.
And here's why it's a predicament. So there's an amount of people today that are owed money. Okay? Do we know that amount? No. Is it significant? Yes. Okay. So people are owed money, money that those people need to pay bills, buy inputs, make equipment payments, land payments, rent payments, you know, all that stuff. They're waiting for that money, okay? And they're not getting it. And then there's the folks that are going to pick up the phone tomorrow and they're going to sell grain to this company, okay? And so the reason I'm in a predicament here is that no matter what happens, the way that this is spiraling, people are going to get hurt. Farmers are going to get hurt, someone's not going to get paid. And so, like, I sit here today thinking, well, geez, I've talked to all these people. I've learned all this stuff that's going on. It's not good. Every time I peel a layer back on the onion here, it's getting worse. But people are owed money today. And even though this company is 100 days plus behind, the checks are still flowing out. What happens is if people stop selling grain to them, then the cash they're using to pay the people that are due money from 100 days ago, it stops. And so the people that are owed this money are, you know, are not going to get if people don't keep selling.
But then I don't want the, the next guy to get burnt or to get hurt in all this. So it's a predicament, folks. I don't know if you can see with the predicament I'm in. But it's a predicament. I'm writing the show notes today, and of course, I went on x and I'm like, hey, do I talk about this for five minutes or not? Like, what do I. I'm not the grain buyer police here. That's not my role. And this isn't fun. Okay. I have to take a walk because I'm going to talk about going through the Canadian Grain commission website, and I'm going to just. I have things from that site that I want to talk to you about here today to help you protect yourself. But I got worked up, and I had to go for a walk because of the situation that is developing here, where it's going. And as I'm reading the site and I'm thinking about this more and more, I had to put on those rubber boots because, of course, we got a nice event here of moisture and calm down. This has happened before.
These situations have happened before.
I talked to a, you know, a gentleman, a green buyer, earlier today, and we were talking about this, and it's happened before, and it's gonna happen again. Right? Like, it's not. This isn't just it. It's already happened, and it's gonna happen again.
And so if you've listened to the show, there's episodes where we've talked about this already.
What I want to say to you today is I can keep talking about the circumstances, the situations, what I know and all that stuff. Like, I can go into great detail, but I'm not going to. Because the key thing here is that I want you to communicate with your farming friends and your farming neighbors and the folks in your life that sell grain. And I want you to make them aware of what's happening, protect them from entering into a situation and where they may not get paid. Okay? That's where I've settled on all of this situation is to not have the next person get hurt. And so we need to talk about it. We need to talk about it as an industry. We need to talk about it as folks involved in agriculture in western Canada. You guys need to talk about it with the people close in your life, that farm, that sell grain. What I found out today is that there's no. There's not a lot of protection. There's no protection unless they're licensed, and this organization is not licensed.
So if they're licensed, then we'll talk about what that means in a minute here. But if you're not licensed, the only thing you can do is get loud, get angry, maybe reach out to, you know, for legal support, but there's really nothing out there for you. So we don't want to see other people get hurt. And I believe it. The situation is going to escalate and get worse yet.
So let's talk about licensed buyers. Let's change gears.
And I could rant all day about this, and I don't want to. So let's change gears to what? What can we do? What can you do to protect yourself? And number one is to check if the company is licensed or not. Okay. What does that mean?
Licensed primary and process elevators and grain dealers must provide security to the Canadian Grain Commission. The security is used to compensate producers in the event they are not paid for the grain they deliver to a licensed person or company.
So what is allowed as security? Well, number one, it could be a bond. It could be a irrevocable letter of credit or guarantee, and it could also be payables, insurance. These funds are used to protect the farmer and are used to pay back the farmer. Okay. There are 167 businesses that are licensed to buy grain in. I believe it's. I'll say Canada. That might have been western Canada. I'm gonna say Canada, though. I'm pretty sure it's Canada. 167. Okay. Not everybody has to be licensed. Exemptions include feed lots, hog barns, standing farming operations who exclusively market their own grain products. You do not have to be licensed marketing their own grain products. Okay. There's other examples as well. You can go to the grain commission website and see this.
Now, licensed grain companies must provide security to the Canadian Grain Commission to cover money owed to producers for grain deliveries. Again, we're talking about what a licensed company is. When a licensed company fails to pay, the safeguards for grain farmers program uses the company's security to pay you if your claim is eligible. Failure to pay could involve any of the following problems. The company asks you to delay cashing its check. The company refuses to give you a check.
Sound familiar?
Right. The company's check bounces. I have actually seen that happen to a grower where a check bounced as well.
So those are the reasons that you can phone the green commission, say, hey, these guys aren't paying me. I need to log a complaint or file a complaint. Okay. And if they're licensed, then there's funds there. There's security there to pay the growers. If they're not licensed, there's no security for you. And so you can see why this is important, right? Very important.
Now, we can go to the grain commission website right now. As while recording, we can go and take a peek here at who is licensed. They're all listed. You can type them in and say, hey, I want to deal with this company.
Are they licensed? It'll tell you. And you can even see, like, the new ones. It'll tell you who's recently has been licensed. It'll give you that list as well. There's 17 pages. There's 167 entries on here. So, like, you know, I see, like, Agricorp processing out of moosh jaws on here. ADM out of Windsor, Ontario. That's their head office. They've got a whole list of elevators licensed on here. Right? So you can go look them up.
The other thing you can go and take a peek at is changes.
So if someone where a license is no longer in effect. Okay, this is as of April 19. So there's a bit of a delay here. There's one that stands out to me here is, as of April 1, grain Millers Canada of Yorkton. They are not. No longer licensed as of April 1. Again, I'm not going to go down this list as, like, a vendetta of who's licensed and who isn't. But, like, if I was a, if I was dealing with grain millers, for example, I would just pick up the phone and say, hey, guys, I. We do a lot of business together. I just noticed that you're not. That your grain dealer license was not renewed. Can you explain why? You know, what, what risks do I have? And there's probably a very logical reason for that. Okay.
[00:17:09] Speaker B: And a logical reason.
[00:17:10] Speaker A: I can go down the list here to Cargill Limited as of January 31. Edmonton, Alberta. Viking, Alberta. Well, they're not licensed anymore because those locations are.
Their primary elevator licenses is no longer held. Those locations are closed. Okay. So, yeah, they don't. They don't need that. But there's a whole list here. There's not a lot of them, but, you know, it's just something you want to peek at every once in a while. And then you can also see, like, who recently got a license. And so you see, like, purely Canada Foods on here. As of April 1, you see battle river railways on here with a couple. Three locations.
You know, I saw g three was on here, our, our Melfort location. Brand new build. Right. It shows up on here. So you can see who's got a license now as well. And, of course, the company I've been talking about does not have one pops up on this list because they're not licensed. So just a couple last things. Here. And I hope this is resonating with you and makes sense. There's not a lot of protection, but this is the key one.
And just a couple other things. It's important to read the terms and conditions in your contracts, especially around payment dates. So know how many business days or calendar days it says until you're going to get paid. And, you know, back when I was a grain buyer, we had to pay some type of, sorry, that was when we didn't take it on time. We had to pay a storage for when it comes to payment, that, that's not applicable. Read their payment dates, make sure you're aware of what those are. Okay. Now, I'm not an expert in this field by any means, but if someone, if someone owes you money and is not paying, it's still best to call the grain commission and have it recorded there. Have it on file there. Because what I'm noticing is even though farmers aren't getting paid on time, there's not a lot of, there's the odd frustration out there and the odd complaint. But I think I said this earlier, as a community, we do need to band together a little bit in these types of situations and report, record, highlight what's going on. And if it's impacting you, it might be impacting somebody else as well. Okay. If someone owes you money and they're not paying on time or they're delayed or they have an excuse, I don't know. I'd still call the Green commission and see what they tell you. Now, there is all sorts of, it's a big website with lots of different things on it, but it says, you know, this is right off the website. Grain companies operating without a licence may be in violation of the Canada Grain act. The Canadian Grain Commission may not be aware of their operations or may be in the process of licensing them. If you are aware of a company operating without a license or have questions about the licensing status of a grain company, contact the Canadian Grain Commission.
I'm going to leave it at that for now, folks. Again, reach out to the show if you want to talk about it more. I don't want to talk about it anymore, but I can't sleep at night. If we don't talk about it because somebody else is going to get hurt this week, somebody's going to sell, and at some point it's spiraling. At some point it's just not going to work anymore. And bottom line here is that farmers are financing the operation of this business. And I don't know if you a farmer should be. So anyway, I'll leave it at that. All right, hopefully next week's hot topic is about doing some fantastic crane marketing decisions or something like that.
Okay, I want to move over now to some positivity and some questions that came in the mailbag sponsored by pioneer seeds. There's still one bag of P 516 L to give away. And our winner today is Val. All right, I'm going to read Val's question first here, if I can pull it up quickly, because it actually had my, had my head spinning a little bit, which is great because I had to phone a friend on this one. And so Val submits a question about fertilizer, and she says, how can you hedge nh three pricing or pre purchase nh three for spring use? I hate having to wait till mid December and forward to make a purchase contract for the following spring. Is there another way to lock in my nh three? What is the current breakdown of farmers that currently use nh three versus urea in a dry blend versus liquid versus top off in northern Alberta? What is the trend? So, Val, that's there. There's a whole bunch of stuff there. Okay. And so the, uh, the exciting thing is, of course, we have James Mitchell that's been on our show, uh, a few different times here. And so I posed the question to him, uh, and Stephen as well, because they're in the know. All right? They are in the know when it comes to, uh, comes to this. So when I asked them about that ratio, farmers, that breakdown of what they're, of who's using what again, northern Alberta, 460 zero is the majority of the nitrogen market greater than 50%. NH three is in second place at about 35%. And u an and others are 15% combined, you know, give or take there. And so there's a large cost of entry into the NH three market. I'm not going to go into all those details today, but it is according to the James and his team there, they'll call it about 35% of the use and not many players involved, lots of rules, regulations, lots of equipment needed. So that's what we're seeing there. Now. When it comes to hedging your NH three, there's no simple answer to this one, Val, because what came through with conversations with Steve and James was that one of the best ways to hedge yourself might be buy urea in the summer, fill programs, June, maybe July, and then sell that back at some point and then use those funds to buy your NH three. So you might buy your urea in June, hold it all the way to mid December, sell it and, and then buy your nh three with that. And so the interesting thing is, I do think that's got a lot of play there. I think that's a very interesting one to monitor and to do a bit more research on. But there's no, you know, there's no guarantees either in these, the way these commodity markets have been going. You buy that spring urea, is that going to be, you know, you'd have to be bullish nitrogen thinking nitrogen is going to climb. Otherwise you just sit on your hands until December and buy when they offer it to you. But if you think that that's the scenario, that's kind of neat. But the thing is you got to find the buyer on the other end. But valve, you want to email the show one more time with that question? I got a couple answers for you there, too. So that was pretty neat. I think there's something there to look at. I appreciate Steven and James from Crop management network helping me with that one. And of course Val, you are our winner of that p 516 L. So ill be in contact with you in regards to that, too. Now I got a, two questions came in about futures first, contracts from Sean and Alden.
Weve been chatting about weed and futures first on weak contracts because were a bullish basis here.
It was a simple question, where can I do a futures first contract?
Which grain companies can I do this with? And the list is short. Okay, you ready? Vitera, Cargill, Providence grain, which doesn't have that many locations. And now G three is in the mix. So there's a lot of others that will let you do a basis contract, but not lock in futures only or futures first or whatever you want to call it. That is the list. Now, there's a big, some big players in there. G three, Vitera, Cargill, those are big players. But if you want to lock in futures, leave your basis open for a basis appreciation.
Yeah, there's not a lot of options out there for you. So that is the answer to that. What? I talked to a few individuals, I reached out to a few companies. I thought the list was bigger than that. It used to be, but that is the current list. Now if you know any different, please reach out to the show and let me know. All right. And then my final question came in from Kyle. It was about act of God.
All right, so what are the downsides of act of God provisions, not including the extra cost? What are the things to be cautious about when you think of an act of God contract? You think, well, there's not a lot to worry about. There's not a lot of concern, right. There's an act of God clause on it. But I did reach out to a few advisors and a few folks, and what came back, and in my own thoughts, what came back here as well, the first thing that popped up in my mind was this, like, discount schedule. So you may have an act of God clause, but yet you produced something different, a different spec than what you signed, better or worse. Right. And so what's out of our control at times is that discount schedule or that premium schedule. So your, your green peas are high bleached, but you produce them. You have the bushels you're required to deliver, but company a, B, and C all have different discount schedules. And unfortunately, the one that you're partnered with has the worst discount schedule for your high bleached green peas. Now, what I would do is negotiate. Everything's a negotiation, but that's one of the things, right? So you've committed it, you do have it, and you have to deliver on that discount schedule. The other thing is that even though it says act of God on your contract, you still need to clarify the definition around that because it can be different with different companies. So you may be sitting here thinking, well, you know, this grasshopper infestation is an act of God. And in the contract it's not. Yeah, I probably have some different examples to come up with here if I think for a minute. But it might just be act of God, but it clearly is against hail, drought. And maybe that's it. Or maybe there's a couple things, but not all encompassing. So that's my watch out with act of God contracts. Again, I have an active act of God contract right now on my new crop. Green peas. Right. For the farm. I've been very aggressive on green peas and green lentils, so we'll certainly take a look at that when, when the fall rolls around. But anyways, you know, we done lots of business with this company and we, we have an understanding of what we've signed. So. But, yeah, that's a great question, Kyle. I hadn't thought about that for a while. So thanks for submitting that. And so, folks, if you want to participate in the mailbag segment, all you have to do is email ryanthefuturespodcast CA or go to the website, send me in a question. I actually have a few more, but I'm going to save them for next week's episode. Okay. I'm gonna, I'm gonna save them here. For down the road. Yeah, just keep firing them in. I know you're gonna be busy planting crops here, or you already are busy planting crops. Send them in, and I'll do my best here to get them answered. And I thought that was a great variety of questions after a very quiet month. And again, congrats to Val for winning that bag of p 516 l.
All right, folks, so we're gonna keep the winning going here. We're gonna set up the next giveaway.
I'm gonna have Holly here join me from UPL, and I'm super excited. Let's get into it with holly and what they've got going on there.
I have Holly Dirksen with UPL joining me this week on the podcast. Of course, at the start, I talked about how UPL was joining the show to give away a whole bunch of exciting prizes here for the month of May and the month of June. We're lucky to have Holly with us today. Holly, how is your week going?
[00:30:06] Speaker C: Oh, it's pretty good. Everyone's getting some much needed moisture, so I think we're pretty happy.
[00:30:10] Speaker A: Yeah, we did get some snow here outside of Edmonton, which I'll take 100%. You can see the grass, like, popping out now from underneath the snow, and it's nice and green, so it's pretty exciting. Yeah, I like it.
[00:30:22] Speaker C: Yeah. Way better than it was.
[00:30:24] Speaker A: Yeah, 100%. So we'll take more. I know. I know. People are going to get antsy here, but we'll take a little more when it wants to come.
[00:30:30] Speaker C: It's just may 1. We don't need to get antsy yet.
[00:30:33] Speaker A: Exactly. Exactly.
Okay, so tell us a little bit about what you do over at UPL and a little bit of your background as well. Sure.
[00:30:41] Speaker C: So I am a TSS, which is technical service specialist. Fancy word for agronomists. So we do the agronomy trials for the team. So training the sales staff on new products, but also working on the research side of things and looking at the products a couple of years out before, you know, they hit the market, so that we're able to get a good feel for them. So, yeah, I live in Manitoba, and I've worked for EPL for five and a half years ago.
[00:31:06] Speaker A: Nice. Awesome. Okay, so I don't know anything about agronomy. Honestly, if I gave agronomy advice, like run to the hills. Cause I have no idea. I'm a grain marketing guy. So is there anything here in 2024?
We're recording at the beginning of maybe. Is there anything out there that kind of stands out. Are weeds growing? Are they not growing? Is there anything kind of strange happening?
[00:31:31] Speaker C: I don't think anything unexpected has happened yet at this point, but yeah, there was given them. With the conditions prior to this week, there's definitely been opportunities to be out and doing some early scouting, and obviously some crop has already gone into the ground. So doing that early scouting out there, there's definitely the annuals starting to emerge. So we've seen Kosher, we've seen wild buckwheat. You know, those weeds are already out there. So in those situations, if they're ahead of the crop, that's when it becomes really important to making sure you're staying on top of your weed control.
[00:32:02] Speaker A: Okay, fair enough. So this week, we're giving away some battalion.
What can you tell us about battalion?
[00:32:11] Speaker C: So battalion is brand new for 2024. So if you haven't heard of it, that is why. But it is our all in one product for weed control in wheat. So looking at your broadleaf and your grass product all built into one product, so there's no need to mix in anything extra. It's nice one skew to deal with when you're looking at your weed control in weeds. So it's a resistance management tool as well. So for something like Kochia, like I mentioned earlier, obviously we know there's more herbicide resistance showing up with Kochia every year. So there is two modes of action in this product that will have activity on Kosher, which is super important. So, yeah, four active ingredients, three moments of action for your, for your all in one control, and wheat.
[00:32:55] Speaker A: Okay. And so you said kosher, and I even know what kosher is. So it's gotta be a big deal out there. Cause I even know what it is, so. All right, cool. Okay, folks, so Holly, thank you so much for joining us. What you need to do those tuning into the podcast, it's nice and easy. We're giving away 40 acres of battalion. Okay, we're going to do this for the next couple of weeks. I have a question I'm going to ask, and all you need to do is text in your answer and you're going to text it to 1855-606-1889 again, it's a podcast. You can back it up and listen to that again. But the question for this week is, do you need to tank mix other herbicides with petallium to control additional weeds?
Again, you're going to text your answer to 1855-606-1889 I'm looking for a one word answer.
I'm teeing this up for you. One word answer. We're going to pick a winner next Wednesday, and so get after it, folks. Text it into the show. What? Sorry. The question is, do you need to tank? Mix other herbicides with battalion to control additional weeds? All right, Holly, thank you so much for joining us this week on the what the Futures podcast.
Maybe for next week or the next time we get together, I'm going to take pictures of what's growing in my wife's garden because I can't identify anything in there right now. And you can help me out with that. Sound good?
[00:34:25] Speaker C: Yeah, I'll try.
[00:34:26] Speaker A: All right, thanks, Ollie. Take care.
[00:34:28] Speaker C: Yeah. Have a good week.
[00:34:32] Speaker A: All right, folks, I've got Chuck Pack Penner with left field commodities joining us once again here on the what the Futures podcast. Chuck, how's your spring going over there?
[00:34:43] Speaker B: Well, not too badly. You guys are starting to scratch around on the fields. You get a little bit of showers here and there. Nobody's complaining about that. So, yeah, if it was June 1, that'd be a whole different story. But May 1, they're still pretty happy to get the moisture.
[00:34:55] Speaker A: Yeah, we are as well. We got snow here, so we'll take it. But I don't want to add salt in the wound at all. But are you a Jets fan by any chance? No, I'm a Habs fan.
[00:35:03] Speaker B: Sorry. That's, isn't it? Yeah, they didn't even make the playoffs.
[00:35:08] Speaker A: But you didn't have the heartbreak from last night, so, yeah, we could move on. It was.
[00:35:11] Speaker B: I kind of, whenever I got part ways through the game and then I went to bed, I thought, yeah, never mind.
[00:35:16] Speaker A: So, good rest. Yeah. Good, good. That's good. Good thing you did that. I know we haven't chatted in quite some time, so we have an extensive list here today.
So appreciate you taking some time for us, but, you know, the last time we had you on the show, we chatted about India. You know, a little bit there a few different things around India. But what's the latest with maybe the pee market? And when you look at India and maybe other countries.
[00:35:41] Speaker B: Yeah, sure it is. India is once again, for those who have been asleep for the last month or two, India has become the market again for peas. And so in early December, they dropped. They had a 50% import tariff on peas, and they actually limited volumes to zero, so there weren't any anyway, no matter what the tariffs were. But. So they dropped their tariff to zero for yellow peas. Not greens, but yellows.
[00:36:09] Speaker A: Okay.
[00:36:10] Speaker B: And so that started a flow of peas into India. So we've been moving for some pretty sizable volumes in December, January, February, and I think in, see the data in March, I think there will be some decent volumes. And so India has become that again. We've, by the end of February, we had moved 700,000 tons of peas to India.
[00:36:31] Speaker A: Oh, wow.
[00:36:32] Speaker B: So that's real money.
[00:36:33] Speaker A: Yeah.
[00:36:34] Speaker B: And so that's why we've seen some of the gains in bids and things like that. The problem is, is that that zero tariff was. Well, it was originally set for the end of February, I think, and then it got bumped to March and then it got bumped to June. And so now the big, big question is, is that going to, are they going to keep extending that tariff, pushing that tariff, kicking it down the road, that zero tariff? And because then very soon, it'll start to affect new crop peas as well, too. So we've had gains in old crop yellow pea bids. And so, you know, for over 14 is no longer all that rare. And so we've seen those kind of prices, new crop bids are edging higher, but, but are still in the eleven to 1150 kind of a range. And so we haven't seen that full impact yet because exporters aren't quite sure whether that's going to happen or not.
[00:37:30] Speaker A: Okay.
[00:37:30] Speaker B: So the things that we watch in that market, then, are what's going on with their pea prices in India and also their, their prices for desi chickpeas, because those two are connected or substitutable. And so that is probably the biggest clue about whether they will keep allowing imports to come in. And so far, that's looking positive. The desi chickpea prices are the highest they've been in quite a few months. And yellow peas are, when they allowed imports, the prices went like that, and then they're starting to tick higher now. So that's a fairly positive signal. So you never know for sure. But I would probably place the odds at about 70 30 that, that they will keep allowing imports in.
[00:38:18] Speaker A: Okay.
[00:38:18] Speaker B: It's not just canadian peas, though. Russian peas are starting to have been showing up there, and ukrainian peas and peas from Turkey and, which are really russian peas that went through turkey, but whatever.
[00:38:31] Speaker A: Okay. Yeah.
[00:38:32] Speaker B: So, so that's been really, really positive. So, you know, that's, that's a good part. That's the, that's the good news part on the, on the pea market. I don't know if you want to hear the bad news or not.
[00:38:42] Speaker A: Always. I got to hear them both. Yeah.
[00:38:44] Speaker B: Okay. Well, China had been our main buyer. Ever since India dropped off the map in 2017, China has been the big buyer. And recently their imports have really, China's imports have really dropped off, including I think Russia's, this russian peas this time were about 60% of the, of the market, of the chinese imports in March. So we're kind of losing out on some of that market. Some of that might just be seasonal and China will pick up again later in the fall. We'll see.
But right now India has kind of just like China saved our hide when India left the market. Now India, it's flipped around and India is now really helping us when chinese demand is dropping off. So the net effect is, I think we still see some pretty good markets.
[00:39:37] Speaker A: But yeah, I was going to ask you the odds that he gave them to us, 70%, 70 30, place it out for India, extending that program. If China ever wanted to buy canadian peas as well, that would lead to a pretty exciting fall for us, wouldnt it? From a price perspective?
[00:39:54] Speaker B: Absolutely.
[00:39:55] Speaker A: Yeah.
[00:39:55] Speaker B: If you had both those countries running at the same time, for sure. And im not saying that China wont be back.
[00:40:00] Speaker A: Yeah.
[00:40:01] Speaker B: And you know, we don't, we don't know that. But there is always these russian peas that are kind of, they're going to put a cap on the market. So it won't be, it wouldn't be a runaway kind of a rally.
[00:40:13] Speaker A: Yeah.
[00:40:13] Speaker B: But it would be, it could be a pretty strong one. And the russian peacrop, they're forecasting at about 4.6 to 4.8 million tons, whereas ours is maybe three and a half.
[00:40:25] Speaker A: Okay.
[00:40:26] Speaker B: So they are the big boys, the on producing anyway, they consume a lot domestically, but yeah, they're a real concern and they're not going to go away either.
[00:40:36] Speaker A: Is that number higher than last year? That 4.6 to 4.8, is it kind of steady?
[00:40:41] Speaker B: It's about the same, but it is like last year was a record. So this would be another record in the russian crop. There's that area down south that we've been talking about in the last few weeks, but it being very hot and dry. So there's some peas grown there. So they could be suffering. But then there's also peas that are grown up in Siberia, north of Kazakhstan.
[00:41:02] Speaker A: Okay.
[00:41:03] Speaker B: And there it's too wet and so their planting window might be pushed too late for planting peas. So I think some of the early estimates were over 5 million tons. Now we're scaling them back already.
[00:41:14] Speaker A: Yeah. Okay. Okay. Fair enough. And what about green peas? Anything, you know, that you're seeing there. I know India is not really in the market there, but anything you're seeing.
[00:41:25] Speaker B: Yeah, the green pea market is more, I mean china is a big buyer of those, but not as dominant as they are in yellow peas. The old crop market is still holding up pretty well, but we're getting close to when people start thinking about new crop markets and where overseas buyers are saying, I'm going to wait now until we get to 24 crop and then we'll start buying. So right now there's this differential of, well, what old crop bids, 19, $20 in ballpark and then new crops, 14 1415.
So there's quite a, there's quite a spread there, quite a gap.
[00:42:03] Speaker A: Yeah.
[00:42:03] Speaker B: So if you got anything left in the old crop, I can't see any reason to hang on to it, frankly.
[00:42:08] Speaker A: Don't be, yeah, don't be that guy.
[00:42:13] Speaker B: Shop.
[00:42:14] Speaker A: Yeah, yeah, yeah. For sure. You can see it coming. It's there. Yeah.
[00:42:17] Speaker B: Yeah.
[00:42:18] Speaker A: Okay.
[00:42:18] Speaker B: And I think we'll see more green pea acres here in western Canada this fall. And you know, they grow green peas in other parts of the world too.
[00:42:27] Speaker A: Sure.
[00:42:28] Speaker B: I'm a little surprised actually that the new crop market has held up as well as it has, that they haven't got enough coverage and started to drop their bids.
[00:42:35] Speaker A: So yeah, you know, it's been nice to be able to take advantage of that and take advantage of the, of how long those bids been out there. But that's another thing is, you know, growers are planting these pulses now, you know, start locking in some of that margin as well because there's no guarantees that it's going to stick. So switching gears now to lentils, green lentil values seem to be kind of fading or pulling back here. What are you seeing in the, in the lentil market?
[00:43:09] Speaker B: Yeah, on the, it's a similar picture to green peas is where the old crop bids are way above the new crop prices. And we are starting to see a little bit of, I don't know, you call it erratic or behavior in bids. So some buyers, they might bump up their bid a couple of cents because they still have a sale to fill. Others drop their bids a couple of cents. So you're seeing more action in that. And that tells me that we're getting close to them finishing filling all of their old crop sales. And again, when you have, when you have large green lentils at $0.80, old crops and a new crop at, geez, what are they, mid, mid fifties now? Yeah, something like, yeah, I'm trying to remember now yeah. And so, so you have this, again, this big gap. And so if you're sitting on any, you know, you might be able to squeeze a penny or two out of the market. But, boy, that downside risk is a lot bigger than, than what the upside potential is. And so, yeah. And again, we're expecting big increases in green lentil acres here in Canada and in the US, and probably Kazakhstan and Russia will try to do that, too, depending on their planting season and all of that kind of stuff. So there's going to be people trying to grow a lot more green lentils. So again, I'm just like green peas. I'm surprised that new crop, green lentil prices have held up as well as they have. Like, I don't know, are farmers just not selling or maybe the acres aren't out there that we think are out there? There could be a couple of different reasons, but I think there's still, even for the new crop, there's some considerable downside potential.
[00:44:51] Speaker A: Yeah, I'd say there's still a lack of selling in a lot of areas, obviously, a dry winter as well. But I've been a big supporter of selling those, the green crops. I was calling them green peas, green lentils with act of God, you know, not a lot of risk there. But I still think it has been slow from what I can tell. So we'll see.
[00:45:16] Speaker B: That makes sense.
[00:45:17] Speaker A: Yeah.
We have a stats can report coming out next. Is it next week, you said?
[00:45:24] Speaker B: Yeah, next Tuesday, I believe. And it's one that people usually don't care much about, which, you know, whatever. That's, you know, you don't want to read too much into these, but it's their March 31 stocks report.
[00:45:36] Speaker A: Okay. Yep.
[00:45:36] Speaker B: So it's, you know, it's based on. No, I'm trying to remember now if this one is even another one of these where they kind of generate numbers without farmers responses.
[00:45:46] Speaker A: Yeah, it's getting confusing. Which is. Which now? Yeah, yeah, yeah.
[00:45:49] Speaker B: But in any case, like, you know, we look at, you know, they'll, they'll look at commercial stocks, and I think they have some indications of on farm stocks and things like that. And it's interesting because when I look at this year, there's some crops that we'll be looking at some pretty heavy supplies going into or in March as of March 31.
And then there's some that'll be very, very tight. And there's not a lot that are middle ground. Canola might be one that's middle ground, but there's some, I would say barley still sitting on some big supplies. Maybe even oats would be there as well, too, surprisingly. You know, we've been, we've been, I don't know. I have been, I'm not going to speak for anyone else. I've been wrong on oats for probably most of this year and freely admit that, but. And then there's other ones like peas and like lentils, where we're going to be very, very tight by the time we get, you know, at this report. And then that also means by July 31, we'll be very tight as well, too. So there's some crops, there's really not much cushion at all. And in others it's kind of. Yeah, we're pretty comfortable right now.
[00:46:56] Speaker A: The canola number is going to be an interesting one because there's such a wide range of estimates when it comes to potential ending stocks here. So as we continue down the calendar, it just gets zoned in a little bit more. Or you can't, I don't know how to say it necessarily, but you get closer to the end date and it's going to be a number here soon. So I'll be curious to watch that one.
[00:47:24] Speaker B: Yeah, that one will dial in as we get, as we get a little bit closer. But there are some big differences.
[00:47:29] Speaker A: Yeah. So I'll be curious to see that one for sure. And then even maybe the wheat, like wheat, has been in demand all winter here. It just hasn't slowed down at all. So, you know, we'll see what that number looks like, too. Yeah.
[00:47:42] Speaker B: And the canadian wheat situation is our supplies are, we think are quite tight even on our s and d. We've adjusted them to add back in, add some unreported stocks or whatever you want to call them, unreported production into our s and d just because it was impossible that it could be that low last year or the year before. So we've kind of been adjusting as we go, and even then we're going to be getting quite tight. The thing is that it doesn't affect the futures market so much. It really hasn't. We've seen it in the basis that's been probably the best clue of both, that supplies are getting drawn down of wheat.
[00:48:20] Speaker A: Yeah. Yeah. Just circling back really quick to canola exports, is there anything on your radar that highlights a much bigger ending stock number or much tighter from what you're seeing?
[00:48:32] Speaker B: Bigger or tighter than what? Sorry, that's the question.
[00:48:35] Speaker A: Bigger than, I guess we could pick a number and go, we could say.
[00:48:40] Speaker B: Than last year or yeah.
[00:48:42] Speaker A: Yeah. Let's go.
[00:48:43] Speaker B: We're going to have bigger ending stocks than last year. I don't know if a lot bigger.
I try not to, I actually try not to read other people's analysis of the market because I want to come to my own conclusions and not, you know, follow what other people are saying or things like that. But it's pretty hard when you're talking to people and they say, well, this, this company says that ending stocks are going to be like, just ginormous.
[00:49:07] Speaker A: Yeah.
[00:49:08] Speaker B: And then, and then somebody else says, no, they're going to be, you know, very, very low, under 2 million tons and, and so on. It's kind of, when you get asked those questions, you kind of think, well, how did they come up with those numbers? And so you really have to math it out. Yeah, these kind of estimates, because people will adjust, make some of these adjustments. So the one that has just massive ending stocks, I think they're basically saying that we have unreported stocks carried over for several years now and that sort of thing. And then they're also looking at very, very low exports. So you were asking about exports for the rest of the year.
Based on what we're seeing in terms of some of the movement, and you get the weekly CGC trade movement experts and farmer deliveries and elevator shipments and all of those kinds of things, I think we're looking at some pretty decent movement into the late part of the marketing year.
We tend to slow down as we get toward the end, but I think those numbers that we're tracking all the time are showing that there isn't a weak movement. In fact, if you think about the canola marketing year, I'm just looking at the chart here as I'm talking to you, but we had very, very low exports early on in the year. And then as we got about two thirds of the way, and all of a sudden you'd start to see spikes in exports and then some bad weeks and things like that, but more spikes as we've gotten more recently. And so we don't need a massive export program. It's going to be smaller no matter what. And we don't have a whole lot of supplies to do a big export program anyway.
And so, yeah, even if we do just kind of an average from here on out, we're going to end up with a little bigger ending stocks than last year, but not these massive numbers. The number that's sometimes thrown out there of carry out of, I don't know what the numbers are, six or 7 million tons.
[00:51:11] Speaker A: Yeah, like that. Yeah.
[00:51:13] Speaker B: You know, if that was really the case, we'd probably have canola, you know, $400 a ton.
Not what are we now? You know, 650 futures, six and a quarter or unchanged, something like that.
[00:51:25] Speaker A: Yeah.
[00:51:25] Speaker B: So otherwise you'd have farmers just dumping stuff. If you had. If you were sitting at six or 7 million tons, farmers would be absolutely dumping it now.
Prices would be. Would be in the toilet. So. So that, to me, is one of the biggest indications.
[00:51:40] Speaker A: Well, and I fixed it, Chuck. So I took the big number and I publicly said my number was zero for carryover. So, two opinions, I put them together, divide by two, and it got us right where we had to kind of be. Maybe even a little on the high side. But it's. I fixed it, so. All good.
[00:51:57] Speaker B: Yeah, we're. I think our number, and my partner, John is the one who. Who handles the canola SMD. But I think we're somewhere between two and a half and 3 million tons.
[00:52:04] Speaker A: Yeah, you bet. Okay, cool. Last thing for today. I know we've kept you a little bit longer, but a little bit of moisture in your backyard. A little bit of moisture in my backyard. What are you seeing from a moisture perspective out there?
[00:52:15] Speaker B: Yeah, it's interesting. Last week I drove up to Norquay, Saskatchewan, and I've never been to Norquay. It was great. And so I drove up, drove up to 16, the yellow head, whatever, and then up to. Up to Russell, Manitoba. And then basically, you go up the west side of Manitoba, and then you get up to Bonito, and then you head west into. And that whole drive, I was seeing low spots with a bit of water sitting in them.
[00:52:41] Speaker A: Okay.
[00:52:42] Speaker B: And the sloughs were full and all of those kind of things. Now, I know that's. That's often where you have more of the moisture.
[00:52:48] Speaker A: Yeah.
[00:52:49] Speaker B: You know, when you look at the maps and, you know, previously, you know, to the end of March and those kind of things, they showed that big area of kind of like Regina south that was really dry. And then, of course, up your neck of the woods was one of the big dry spots, too. And so this week, we're getting a bit of rain, and it's not curing all of those. It's not solving all of those issues, but it's helping move things along a little bit. And then those drought areas just shrink a little bit. They're still there. And in the worst spots, they still need a lot of moisture, but they kind of grab, you know, they shrink a little bit. So I think it's even just psychologically, it's providing a bit of optimism. Nobody wants to plant into dust, no matter even if you make your bins bust.
[00:53:34] Speaker A: Yeah, exactly. Yeah. Yeah.
[00:53:36] Speaker B: People don't want to do that.
[00:53:37] Speaker A: Yeah.
[00:53:38] Speaker B: So, yeah, I think it's providing some optimism. Of course, we need to that to keep on going and getting these regular showers, but it's nice. We're beginning of May now and a lot of places. I have gotten some acres planted and so, you know, we're crossing our fingers and hoping for the best and all of that kind of stuff.
[00:53:59] Speaker A: Yeah. I chatted with some growers over the last couple of weeks, but basically 3 hours apart, three farms and within a three. Yeah. The furthest two or 3 hours apart. Okay. And so last week, all three of them were not contracting any grain. Even if it rallied a whole bunch, they were not comfortable contracting any grain today there. Out of the three, there's only one now that would sit here and not contract green because the other two have had a few moisture events now. So, you know, you just go back to that psychological part and, yeah, there's still some dry pockets. The weather is improving for some, those drought areas shrinking a little bit. I'm with you 100% on that, so. Yeah. Cool. Well, Chuck, anything else for us this week?
[00:54:44] Speaker B: No, we'll just keep watching the weather. And not just here, but in all kinds of places there.
[00:54:48] Speaker A: Yeah.
[00:54:48] Speaker B: 100% spring crops in the ground and and, you know, there's all kinds of fun things that could happen yet this year.
[00:54:55] Speaker A: Yeah, you bet. Well, I appreciate your time. Thanks for jumping on the show. Have a great month of May here, and we'll try to connect here either late in the month or early part of June.
[00:55:03] Speaker B: Sounds good, Brian.
[00:55:03] Speaker A: Cool. Thanks.
Well, I really appreciate Chuck Penner joining the show here once again. He's always a wealth of information and knowledge. So, you know, we're getting to the end of the episode here, folks.
I've just got the eating your veggies section. Left a little bit of housekeeping here at the end. So thanks for hanging in there. I know that we went the distance here once again on this episode, but honestly, folks, there's a lot of stuff to cover off. So for eating your veggies for this week, I got three for you. Number one, I know you're busy planting crops, and it's super exciting time of year, but try not to lose focus on your crop marketing plan.
If you can take a moment while you're in the tractor to, you know, revisit where you're at, what your plan is I, we talked about office time earlier. We talked about sitting down, pardon me, rewriting it. Just don't lose focus because this is the most, in my opinion, most important time when it comes to marketing crops. Sometimes it's over the next four weeks here, six weeks, eight weeks, it's a very important time. Just try not to lose focus with all the chaos around you with everything going on. I know, I think last week or the week before, I asked you to turn your volume on, on your phone so you hear those calls coming in from buyers and stuff like that. Anyways, just try not to lose focus with everything going on around you. Number two, it's the first week of May and so reach out to your grain buyers about your outstanding targets and the expiry dates on those targets. So just all you have to do is reach out to them and say, hey, or log into your portal and review what you have outstanding. Because what can happen during this time of year is markets rally sharp and aggressive for a very short period of time and sometimes those targets trigger that you weren't expecting. And I actually talked to a grower the other day. He had put in two fresh targets on new crop wheat. And then he got a message the next day and said, hey, do you want to renew this target? And he's like, what are you talking about? We just put that in and he's like, can you send me the list? And it was a target that was put in a couple months ago and just forgotten about. He already had the, he was going to double up the sale is what was, what was going to happen. Would have that have been a good thing or a bad thing? We'll know in six months. Right. Scrap marketing. You'll, you'll see in the next little while. But anyways, I took action and tidied that up and, you know, just caused a light bulb to go off to check with a few other companies and see what was outstanding. So make sure you do that. Check those targets, see what's outstanding. And then lastly, I'm just going to say don't forget to sell some wheat. Okay. We've had a nice run up in wheat. I know there's been some good basis appreciation in portions of Alberta. I'm seeing, you know, nine dollar wheat in part of Alberta. We're seeing 850 in Saskatchewan. 875. I think my dad just texted me that they can hit an 875 target if we just tweak it here little bit.
Switch it to October. Yeah, you know, so, you know, we're getting high eights for a lot of folks for hard red spring wheat, some nines, portions of Alberta. I know there's some fancy ways to try to get a 950 as well in portions of Alberta and probably nine in Saskatchewan. So, yeah, don't. Just don't forget to sell some wheat here again. We're still doing small increments. We're not going gangbusters yet, but keep working at it. Okay.
All right, wrap up here. I just want to mention egg I three has been a big sponsor of the show. Their deadline to apply for crop insurance through them and review your risk management is May 15 or before you plant the crop. So that probably is happening sooner. So if you're looking for some additional guidance around risk management and crop insurance, reach out to Aguy three, AI and Kyle, John, Elise. They can get ahold of you there. Um, the playoff hockey draft, as of recording, I'm still leading this thing, which is not, not good. You're not supposed to win your own prize, right? That's rule number one. But also, when you have this really good start, it's going to fade. I'm in trouble, and it's tight. We've got 20 some teams in. I think there's a 20 point gap. Yeah, I'm sure I'll be middle of the pack by the time it's all said and done. Uh, on the YouTube playlist, uh, that's what the futures hashtag, plant 24. My, I got two songs for this week. I added some new songs, but I've got dancing with myself, generation x. That one's been coming through quite a bit on the playlist. And then two times by Ann Lee, a classic. That's for the night shift crew. Okay. If you need that little pump up, put on some Ann Lee out of the what? The futures playlist on YouTube and enjoy it. All right? Of course, folks, thanks for tuning in. Thanks for making it all the way to the end here. Subscribe to the YouTube channel, follow us on social media X, Facebook, Instagram, LinkedIn. We're out there. And I've got, yeah, some new hats coming, I think next week now, but have a good weekend. Hope you enjoyed the show. Hope you like the new setup. Big thanks to podsound school for helping me out here with the new setup and with editing this week. So I'm out.
