The chief market analyst with FarmLink Marketing Solutions is weighing in on the rise in ag market prices.
"We've got kind of the best of both worlds," said Neil Townsend. "We've got a lot of the crops that we particularly grow in western Canada, have seen strong prices throughout most of the marketing year. Some of that has been frustrating with the dire lack of containers for some of the smaller crops that like to travel through that. Basically, the bottom line is that until we have a better read on what U.S. corn or soybean yield might be, we're going to be supported from the big U.S. corn belt crops."
Townsend believes the U.S. is nervous for two reasons.
"A - They don't see enough acres being planted and B, just because the conditions are not optimal. That doesn't mean they're bad, it just means they're not optimal. I'm always a little worried when you have a big rally, just in the planting sequence because more times than not, like 99 out of 100, you get the crop planted. We don't know what the weather is going to be like in June, July or August, but I would really focus farmers' attention on those three months. June for a lot of the crops in Canada, July for the U.S. corn and August for U.S. soybeans. Ultimately, the price structure that we face in 2021/22 is going to be dictated by those three months."
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