GFM Network News

Understanding basis one of the basics of grain marketing

This measure of local demand for grain in the handling system can help your marketing plans

What’s the basis for your basis decisions? Basis pricing doesn’t get as much attention as it should but is such an important, but often overlooked or misunderstood, piece of the grain-marketing puzzle. While many farmers do pay close attention to basis, others don’t. I initially looked at basis in this column a couple of years ago and

Take a wide view to understand canola pricing

Canada is a big canola producer but it’s the wider world oilseed market that bears watching

Where are canola prices going this fall?’ That’s been a common question, both this year and in years past. Many factors from around the world combine to affect canola prices. From production science, to consumer trends, to shipping and logistics, from new product uses, government regulations and trade barriers, to commodity substitutability — all affect the marginal supply

What you see will change depending on how you look at things.

Taking a new view of grain markets

Don’t get caught looking at any issue from just one perspective

Every now and then you come across a story or analogy that really makes you think. Even if you know an area or subject matter well, you can still learn more about it when you look at it from different angles. This is especially true in the markets where the landscape is constantly changing because

Most of the time markets move in what can be considered a sideways trend.

Expect the unexpected in markets

When the unexpected hits, price variation can exceed the expected very quickly

Last article, I talked about managing risk and uncertainty in the markets. As you might recall, there is an important difference between the two. Risk estimates everything we think might happen. Risk is our guess about what the future holds. More precisely, it is the range of things that might happen and how probable each

Volatility is more of a mathematical definition of how much a market will likely move in the future based on past fluctuations.

Volatile times need a market strategy

Think of these tools as an insurance policy where you pay a fee to avoid risks

Given what’s happened in the markets in the past couple of months, it’s a good time to revisit risk: how to think about it, how to manage it and its practical impact on marketing and hedging. As the coronavirus was unleashing its effects on the markets, I was also reading an interesting book called An

U.S. spring wheat May-August precipitation (inches).

Markets watch the weather

Rain makes grain, and it’s one of the most volatile variables for Prairie farms

Price and yield are the two biggest determinants of farm revenue. Using farming software to run simulations and what-if scenarios shows that even a modest change in commodity prices or crop yields can have a big impact on gross margins and the bottom line. This makes sense, given revenues are top line 100-cent dollars. While

The view from GrainWorld

Most presenters said there are a lot of balls in the air right now, and nobody knows where they will fall

It is definitely one conference not to be missed. Numerous speakers covered various topics although this year it seemed that most things that made me go “hmmm” were in the areas of trade dynamics, political/social factors, marketing and, of course, technology. Political and social factors dominated many of the sessions with suggestions that there will

Currency volatility important to remember

We’re currently at the low end of the historic range for the loonie’s value against the greenback

Canada exports almost a third of its gross domestic products of goods and services. And when it comes to agriculture, those percentages are even higher. Based on statistics from the Canadian Agri-Food Trade Alliance, we export 50 per cent of our beef/cattle, 65 per cent of our malt barley, 70 per cent of our soybeans,

U.K. long-term government bond interest rate (1700-2016).

Derwin: Analyzing interest rate trends

Interest rates can do some surprising things for longer than expected

I put a great deal of effort in to analyzing long-term historical trends to better understand the cyclical nature of human behaviour and its impact on financial market prices. Interest rates are no exception. In fact, interest rates are key to the pricing structure of almost every other asset from stocks, gold and currencies to