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Ratings worries and dry conditions on the Plains lifted Kansas City futures. As of Monday, April 10, the crop progress report good to excellent rating is only 13%.
Why This Matters - Impact on You
This is perhaps the single biggest story in the supply and demand fundamentals, yet hardly anyone is talking about it. The State of Kansas can produce over 10 MMT or roughly 1/3 of Canada’s total wheat production. The drought in Kansas, Oklahoma and Texas will impact wheat production.
Quick Tip - What you can do
With the market potentially entering into an exciting weather market it would be wise to have pricing targets in place. Weather markets are often very fickle and quick.
Bulls and Bears
Technical: November Canola has trended back to $700. Next upside resistance line is 740.
Bulls: Dryness in Argentina is hurting soybean prospects.
Bears: Large crop in Brazil, USA is also projecting a large Soybean crop
Technical: Dec 2023 Kansas Futures is back to $6.67/bu the trend is down. 100 day moving average is $7.73. Next major upside resistance line is 7.44
Bulls: Dryness in US winter wheat growing areas
Bears: Large crop in Australia, Weakness in global demand.
Technical: New Crop in Lethbridge is currently sitting at $7.75/bu delivered.
Bulls: USA Corn crop is slow to get started. Canadian farmers are reluctant sellers.
Bears: Strong Canadian dollar make US corn cheaper. Fedlots are bought up for summer season. China and Australia are taking about removing tariffs.
El Nino Prediction: El Nino is expected to be in full force by July. Historically, this means Western Canada should expect warmer winters.
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