Canada Markets

Ontario Soybean Cash Price Trend

Cliff Jamieson
By  Cliff Jamieson , Canadian Grains Analyst
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This chart shows the trend for Ontario cash soybeans for 2018 (blue line), 2017 (brown line) as well as the 10-year average (grey line), based on Ontario Agriculture data for Chatham. (DTN graphic by Cliff Jamieson)

Historic price data reported by Ontario Agriculture, extended by two weeks using ProphetX cash data, represents an average bid for Chatham that shows the current cash price roughly $.84/bushel CAD, or 7% below the same week in 2017, and $.60/bu. or 5% below the 10-year average.

As seen on the blue line, price has recovered from the week 35 harvest low of $10.70/bushel, to $11.07/bushel this week, although has consolidated in a narrow, sideways range over the past six weeks, with price ranging between $11.04/bu. and $11.21/bu. given weekly data reported.

While DTN's Five-Year Seasonal chart suggests that soybean futures tend to rise from early October through early July, cash prices in Ontario can tend to peak earlier. The 2018 weekly high was reported for week 10, or in early March, at $12.87/bu., while the 2017 weekly high was reached even earlier at $13.34/bu. in week 3, or roughly the week ending Jan. 20. The 10-year average (2008-through-2017) points to the highest average weekly price reached of $13.51/bu. as of week 27, or early July, which is more consistent with the peak in futures seen on the five-year seasonal chart.

The current pace of movement should play a role in price direction in the upcoming months. Week 17 licensed export data reports exports a solid 395,200 metric tons shipped through licensed facilities for the week ending Nov. 25, with cumulative exports over the 17 weeks at 2.1966 mmt, up 25% from the same week in 2017/18. Over 1.1 million metric tons is reported exported over the past four weeks, or week 13 to week 16, a significant volume when current AAFC supply and demand tables are pointing to total exports of 5.7 mmt.

Two key reports will be released on Dec. 6, which includes Statistics Canada's final production estimates as well as the October Merchandise Trade report, which will shed light on the movement of soybeans over the first two months of the crop year relative to the forecast size of the crop.

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Cliff Jamieson can be reached at cliff.jamieson@dtn.com

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