The US futures markets were mixed. Corn gave back a few cents while winter wheat was a little firmer and spring wheat was a little softer. The trade consumed the StatsCanada report like a cheap house red and came to the determination, as you do with cheap house red, that the spring wheat crop was a little better than they had expected. This has seen spring wheat futures at MGEX continue to slip over the last few days.
The durum side of the equation is a little more bullish though. The trade had expected to see a Canadian production estimate around 4.2mt to 5.4mt so a figure of 3.898mt did raise a few eyebrows, if not cash bids.
Surprisingly cash bids for 1CWAD across SW Saskatchewan were softer, ICE durum futures were softer and bids here from one of the only trading houses actually bidding on durum were softer. Over the last few days, as production for durum shrinks so have prices.
We can put this down to a couple of things, the major factor being harvest pressure. The world needed good quality durum and at the moment that is what has come off in the USA and is coming off in Canada.
So in the short term at least the market appears happy with what is in the pipeline and are using price to ration supply, as they do. The lower volume is what may catch them out though. Some analyst expect to see values improve towards the end of this year and into January as world stocks tighten.