Glacier FarmMedia MarketsFarm – As oat futures fluctuate on the Chicago Board of Trade, they remain rangebound, said Progressive Ag analyst Tom Lilja in Fargo, N.D. However, to Scott Shiels of Grain Millers Canada in Yorkton, Sask. there’s a disconnect between those futures and cash prices for oats.
“Over the last, basically year, oat futures have tended to trade between US$3.40 and US$4 (per bushel),” Lilja said. “We got up to around US$4 late fall. It got down to that US$3.40 range the late part of December, the early part of January. They’ve rebounded up to the US$3.81 area.”
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Just within the last few weeks, May Chicago oats climbed from US$3.41/bu. on Feb. 12 to US$3.86 on March 4, with a few large daily price swings over that period.
“Typical market function,” Lilja said of the upward swing.
No relevance to cash prices
To Shiels those sharp increases in oat futures are largely due to another reason.
“If you look at the volumes of contracts that are trading…there aren’t very many people who use oat futures and there hasn’t been for many years now,” he explained, noting there have been pushes to remove oats from CBOT.
“Some companies still trade oat futures, buying on basis contracts. They’re hedging in the same way anyone else hedges on other contracts, to protect themselves,” Shiels added.
He noted the 21.25-cent hike in the May oat contract on March 4 had no impact on cash prices in his neck of the woods. That Grain Millers kept to their price of C$4.25/bu. while some local elevators were around C$4.
“Most bids are based off of what we are selling. That’s very much a function of supply and demand,” he stated.
Meanwhile, Lilja pointed to U.S. demand for the overall increase in oat futures, but they remained rangebound. He said the higher futures price could encourage more planted oat acres in 2025/26.
U.S. & Western Canadian cash prices
Prairie Ag Hotwire reported North Dakota oats were the equivalent of C$3.22/bu. on March 4, falling 29 cents on the week. For the same timeframe across Western Canada, oats were C$4.09 to C$5.01/bu. delivered with movement between unchanged to up 26 cents.
