Market volatility calls for constant vigilance even as producers plan for the coming year, says provincial farm management specialist Darren Bond.
Bond said prices are the most volatile they’ve been in years, and a “huge concern” for producers planning this year’s crops.
“There will be highs and lows as the year goes on,” he said.
Earlier this month, the province put out its 2020 cost-of-production guide. Based on those calculations, profit margins could range somewhere between tight and non-existent this year.
On January 9, PDQ (Price & Data Quotes) listed regional prices for canola in Manitoba between $10.02 and $10.17. The guide targets $10.50 a bushel for canola.
CWRS 13.5 target price in the guide is $6.70 a bushel, while PDQ hard red spring wheat price in eastern Manitoba was $6.07 a bushel and in western Manitoba was $6.25 a bushel.
Troubling for those hoping to see an expansion of pea acreage in Manitoba, the guide puts the target price of peas at $7 a bushel, while PDQ listed the regional price of yellow peas as $6.21 per bushel in western Manitoba and $6.09 in the east.
However, Bond said this represents a moment in time and there will be changes to price crops throughout the year at better levels. Where five-cent price swings may have been alarming in the past, they’re just par for the course now. He’s recently seen an elevator bump a price up by 40 cents.
“That’s why it’s so important for producers to pay attention to these prices,” he said. “Because it might not be there tomorrow.”
Last year saw political, trade and weather instability. This year, the U.S. conflict with Iran has already influenced prices.
Bond said in times like these, management is key.
“Those who produce the most are generally the most profitable,” he said, adding that it sounds like common sense, but the best-managed farms tend to do the best in tough times.
It’s important to identify weaknesses in farm management and work closely with advisers, Bond said.
“Not everyone can be an expert in everything,” he said. “I would think that most producers know what their weaknesses are.”
He encouraged producers to make good use of their advisers, but added he’s continually impressed at the management skills of farmers.
Full cost-of-production estimates can be found as a PDF here.