View the most recent version.

Highlights – July 2007

Situation report

• At the beginning of July, crops were generally in good condition across the Canadian Prairies although there were pockets of excess moisture or dry conditions. Warm, wet weather made conditions ideal for fusarium head blight in Manitoba.  Saskatchewan farmers also detected more disease in their fields this year.  In Alberta, the Alberta Financial Services Corporation reported significant areas of unseeded acres. Very hot, dry weather stressed crops later in the month across the Prairies and reduced yields. Harvesting of a record winter wheat crop was in full swing by the end of July.

• Dry, hot weather reduced the forecast yields for corn in southwestern Ontario by mid-July.  There were concerns that the lack of moisture could also reduce soybean yields.  The harvest of winter cereals began early in July with variable yields but good quality reported.  Most of the corn was reported to look good despite the lack of rain.

• The Canadian Wheat Board (CWB) will continue to have a monopoly on the sale and export of malting barley and the export of feed barley, at least temporarily.  The Federal government had attempted to remove the monopoly by a regulatory change.  However, the Federal Court ruled that Parliamentary approval is required for such removal.  The ruling was made on July 31st, the day before the marketing changes were to take effect.

• The US Department of Agriculture’s June seeded area estimates shocked traders.  Corn seedings were 92.9 million acres, up 19% from 2006 and the highest area since 1944 when 95.5 million acres were planted.  However, soybean area was estimated down 15% from the 2006 record to 64.1 million acres, the lowest seeded area since 1995. Traders had expected a moderate increase in soybean area. The low soybean seedings are expected to result in a tightening of stocks over the next year.  At July 29, both corn and soybeans were in better condition than at the same time last year.

• The high 2007 US corn area and long-awaited rains in the US Corn Belt pressured corn prices down in July.  This made corn more economical than barley for feeding in western Canada.  Barley prices were strong, supported by rising international prices. However, talk of US corn being imported into Alberta pressured Western Canadian barley futures’ prices down. Barley futures’ prices declined the limit on August 1 at the Winnipeg Commodity Exchange following the ruling on the maintenance of the CWB barley monopoly.

• Soybean prices traded higher following the lower-than-expected US 2007 soybean area and resulting forecast sharp reductions in 2007/2008 ending stocks.  Futures’ prices were also supported by good palm oil prices. With slow farmer selling, Winnipeg canola futures’ prices rallied with Chicago soybeans early in the month but gains were muted by good weather and a lack of exports.   Subsequently, the rains that pushed corn prices down also caused soybean prices to plummet in mid-July and to end the month at a lower level. Canola prices followed soybean prices lower with pressure from falling palm oil and EU rapeseed prices.  Although canola prices were volatile, prices did rise over the summer months.