Under the Agridome

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The January USDA report is long in the rear-view mirror. However, when I visited the local farm show in Chatham, Ontario, I took part in a marketing seminar given by a friend of mine. It was interesting to hear a little different perspective on things. However, it was very clear we continue to adjust to the 17-billion-bushel corn crop. Each day since, our markets have tried to be a bit resilient to get back what we have lost. Lots of the talk locally has been about the geopolitics concerning this situation.

Geopolitics is often an afterthought to market action, and I suppose even in our current state at the end of January in 2026, we could say it still is. The U.S. administration certainly has its own unique style of driving the agenda. A few weeks ago, it was about Greenland, then it changed to Minnesota and maybe now it might be about Iran. Canada even caught a bit of that with our Prime Minister Mark Carney sucking up some of the oxygen in the room with his speech in Davos, Switzerland.

There are a few things I want you to take from the Carney speech and burn them into your psyche as we look at the way forward. Carney made several points but I'll only list a few.

"We are in the midst of a rupture, not a transition."

"The old order is not coming back."

"Middle powers must act together because if we're not at the table, we're on the menu."

"Nostalgia is not a strategy."

I like the Carney speech because I thought it laid out pretty clearly the way things are going. It represented a realistic view what Canadians are facing. We're not going back to the way it used to be, there's been a total rupture in what we can expect and looking back nostalgically at what we'd like has to be totally redefined. When it comes to the day-to-day operation on Canadian farms, all of this from now on is true. Nothing can be taken for granted, especially with our American friends to the south.

Keep in mind that I have always said free trade between the United States and Canada is whatever the Americans deem it to be. It's just at this time in 2026, as we go into a Canada-United States-Mexico Agreement (CUSMA) review, the stakes seem higher. However, it might be more because of the players involved this time around who have a penchant for the dramatic versus the Ronald Reagan/Brian Mulroney administrations in 1988 who did not engage in such hyperbole. Negotiations in 1988 were nail-biting tough as well, but it is totally different now. Just go back and read Carney's comments. (See full speech at https://www.weforum.org/…)

There are problems with all of this, and one of them is that we are Canadian farmers. Yes, that is a good thing, but keep in mind we are in a different category versus our U.S. counterparts. They are part of an American agricultural subsidy theme park buffeting their pocketbooks from their own government's actions. As we all know in Canada, there will be no such compensation for Canadian farmers from our own government.

We face this new reality alone and we will have to develop a risk management strategy to forge ahead.

What's that going to take? Well, keep in mind that last point by Carney. Nostalgia is not a strategy. Thursday, March corn finished at $4.30/bushel, March soybeans finished at $10.72/bu and March wheat at $5.41/bu. You might make an argument that these numbers are nostalgic, but I think a better argument is they are reality. What's making it a bit worse is with the uncertainty caused by the Trump administration, gold and silver are going skyward and the U.S. dollar is dropping like a stone. This is forcing the Canadian loonie to go up in value which makes our cash prices much softer. So, what is it going to take? Canadian farmers will simply have to cut overhead, cut our fixed costs, and make it all work.

It's not like we've haven't been here before. However, according to Carney, we haven't, but you know what I mean. Our challenge as Canadian farmers is to operate with our eyes wide open with no illusions. We can't market grain based on what prices used to be, what policies used to be, or how relationships used to work. We have to sell rallies when they appear, manage risk when it's uncomfortable, and make decisions based on margins -- not memories. This is a tougher environment, no doubt about it, but it rewards discipline, flexibility and realism. Nostalgia is not a strategy, but good management still is -- and that, at least, remains firmly within our control.

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Philip Shaw can be reached at philip@philipshaw.ca

Follow him on social platform X @Agridome

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