It has been a challenging spring to get crops in the ground here in Ontario. Your loyal scribe was lucky enough to get his corn planted last week, but many others in Ontario were dodging raindrops and the associated ground conditions.  The risk profile of putting thousands of dollars into the ground and hoping something will grow can challenge the best of us. However, I think wet springs always go down a tough nut to crack. Hopefully better weather will be coming for the rest of the spring.

2024 is far from the worst wet spring I’ve ever seen. It was 2019 where it actually crossed my mind, I might not get crops planted. That’s something we don’t usually think about here in southwestern Ontario. However, as we faced going into July that year there was thousands of acres that were not planted. At the end of the day, I got things in the last week of June and the results that year were about average. What it taught me was no matter what adversity I face in the spring I can always hearken back to 2019 when it was far worse, and things turned out OK.

So far, we have not got the big run up in grain futures that many of us have been hoping for.  This is especially true as we go into a time of year where seasonality tells us that historically we get better prices.   It’s almost like we have to wait for those hot and dry events, which move markets. You have to remember, that rain makes grain and even though it is the springtime that generally doesn’t lead to better prices.  As we plant our crops in 2024, it’s pretty obvious that “big supply” is still winning.  To get grains to scream higher, we likely will need some black swan event unapparent at the present time.

That may come from some geopolitical event and of course it may not. I was reading today about the major trade agreements that Canada has signed over the last several years and how these trade agreements had benefited Canadian agriculture. I’m talking about the free trade agreement with the United States, the Asia Pacific and CETA.  CETA in particular had a great effect in getting Ontario corn into the European Union tariff free.  Unfortunately, as we all know the geopolitical arena is not full of people trying to get along. There are problems almost everywhere, distrust and even retrenchment in rigid positions held by some of our biggest trading partners.

A case in point is the recent announcement by the Biden ministration about a whole plethora of new tariffs that were put on Chinese imports. These tariffs were applied on different sectors like steel aluminum and green tech but also those Chinese electric cars.  It was a 100% tariff put on Chinese electric vehicles effectively denying them any access to the American market.  The move is not necessarily highly unusual, almost more expected.  Our American friends especially in an election year usually become very protective. This latest example is about China, and it might exhibit a degree of chauvinism, but it is what it is.  It certainly isn’t free trade.

On the other side of the world the leaders of Russia and China are meeting together in Beijing to discuss mutual things they had in common.  On the other side of the world, this all seems so normal. That is, operating within a parameter where sanctions are very real.  The BRICS countries are a good example of a group that have got together outside of the western sphere to build like minded trade.  Of course, as farmers we know how fast the agricultural cooperation is between Brazil and China.  It’s just easier that way.

I find that all so difficult to accept.  To me, sanctions never work, economies simply adjust, and memories are long.  Almost every day when I interpret grain markets, I hear something about tariffs being possibly applied to some agricultural commodities.  Of course, the most famous was Chinese tariffs on American soybeans during the Trump administration.  Simply put, North American farmers have never recovered from that.  However, the Brazilian farmers have never had it so good.

So, as we move on in 2024, we are hoping for good things.  Keep in mind this is an election year for our friends to the South.  Sharp rhetoric will be in big supply and sometimes, that leads to things hardly ever imagined.  The only thing that we can be sure of is that we can’t be sure of anything at all.