It is not often that you see wheat off on the 1st of July in southwestern Ontario but that’s exactly what you saw this year. If it hadn’t been so wet earlier the wheat might have even come off sooner. Your loyal scribe started harvesting wheat today July 4th.   In my 45-farming career that is about the earliest start I’ve ever had. The only other time that I can remember harvesting wheat that early was in 1988. For those of you as old as me you will remember day after day of 100-degree temperatures fried the wheat crop into the ground.  I think I was done harvesting that year on July 8th.

That was quite different than this year.   Well at least in my part of Ontario we’ve had wet weather since the middle of May. It is interesting, this year started out so dry and open with hardly a winter. There were many farmers that thought it was going to be a very early spring. However, it certainly didn’t turn out that way with people struggling to get things planted over the last couple of weeks. Ditto for many people across the great northern plains in the United States who have been inundated with rain and flooding.

You wouldn’t know it from what we got from the USDA last week when it’s released its planted acreage numbers as well as the grain stocks.  USDA estimated the corn acreage planted number at 91.5 million acres which is above pre report estimates.  This was an increase of 1.5 million acres from their March estimate.  On top of this bearish news came the old corn crop stocks estimate which was 4.993 billion bushels, 890 million bushels more than last year and 126 million bushels more than the trade had expected.  In other words, everything is OK, there is corn everywhere.

USDA estimated soybean acreage to come in at 86.1 million acres which is down 400,000 acres from their March intentions. The June 1st old crop stocks numbers were pegged at 970 million bushels which is slightly higher than trade expectations and 174 million bushels higher than a year ago. Yes, we know that soybeans are the great liars, so you never know. If we ever want to prove the American farmer enjoys growing corn, we got it in last week’s USDA report. An additional 1.5 million acres of corn from the March intentions report is quite an endorsement.

The July and August USDA reports will give us some indication of how crop yields might be changing. There has been a bit of consternation among some analysts about how all the wet weather in the northern Midwest of the United States is impacting yields.  However, it is difficult to say, it’s not every field has been flooded and the acreage and the grain stocks are high enough it might not matter. Needless to say, there’s lots of weather risk ahead to cause great price volatility when you least expect it.

All of these marketing factors have led to lower futures prices.  However, in Ontario and Quebec we consistently have the one great default stimulus which is the value of the Canadian dollar. Having the loonie flutter around the 72/73 cent level over the last year consistently helps put a floor under prices.  The loonie hit.7346 at noon today which puts it at its highest level since April.

Last week we got a bit of a surprise where it was announced Canadian inflation had risen to 2.9% for the month of May.  This kind of put cold water on another interest rate decrease in the next month. There were many people expecting this, but it is unlikely to come now. Keep in mind that a rise in interest rates would be bullish for the Canadian dollar and a further decrease in interest rates would just do the opposite.  Keep in mind, the Canadian dollar is a thinly traded currency, important to us as Canadian farmers, but not so much to the rest of the world.

As all of this have been going on we also have a shake up on our geopolitics a little bit close to home. Keep in mind, we don’t do politics here.  However, Canadians through the generations always keep a nervous eye on what our American friends are doing down South.  The American presidential debate set off a bit of a firestorm.  Mr. Biden said he had a bad night.   Mr. Trump had a good night.   Simply put, political change in the United States always has big effects on Canada and Canadian agriculture.  We’ll see what happens in November.

As for me, I am hoping to get my wheat harvest completed in bright sunny warm weather.  So far, at least around here we have had very little of that.  I also know as I harvest wheat somebody is planting wheat somewhere in the world. We move on, hoping for better things.