Grain prices in the month of May were a bit all over the place thanks to fluctuating geopolitical concerns and the start of the 2018 North American growing season.
This time of year we tend to see a fair amount of weather premium start to support grain prices. However, the most recent USDA crop progress report showed that the American crop has started out pretty strong.
Also, conditions were turning fairly dry in the Canadian Prairies, but rains at the end of the May have alleviated some of those fears. Accordingly, it’s also alleviated some of the fear in the grain prices, and that’s why we saw a pretty significant sell-off at the end of the month.
However, the main reason for the sell-off was the heightened level of trade risk in the market.
Specifically, grain prices pushed lower as, once again, American President Donald Trump shared that the US would be slapping 25% tariffs on roughly $50 billion in Chinese products. Then, the administration slapped tariffs on steel and aluminum imports from Canada, Mexico, and the European Union.
This put pressure on the Canadian Loonie as it hit a fresh new two-month low before the month ended. Usually, this is good for Canadian grain prices, but given the wet weather in the Prairies, any currency premiums were nullified.
Click on any of the boxes below to see how grain prices for your farm or agribusiness performed in May 2018.
Be sure to sign up for your free 3-week trial at GrainCents as this month could be the most impactful for how and when you price your barley for the rest of 2017/18 old crop, as well as a significant portion of your 2018/19 new crop production.