The market ramifications of frost

Areas of Western Canada flirted with frost again early Wednesday morning. Environment Canada lists two degrees as the low for North Battleford and Spiritwood with Meadow Lake at three degrees. With crops running behind normal development, there seems to be a high probability that frost will cause significant crop damage at some point in the weeks ahead. The market ramifications will depend upon the severity and the geography, but the Prairies are likely to end up with more feed wheat than in a normal year. That might moderate feed barley prices. If frost is serious, there could be late crops cut for green feed. That might help augment the hay supply. Widespread frost can cause a shortage of some top quality grains. In the past, frost has increased the top grade price premiums for crops like lentils and flax. That could happen again. Of course, while there are market benefits from widespread frost, this only happens because a lot of producers take a big hit in their expected returns. In the month ahead, producers across the Prairies will be watching weather forecasts and the thermometer. I’m Kevin Hursh. See the weather forcast and grain prices at www.dynagra.com.

www.hursh.ca

Kevin Hursh, PAg, CAC