GROWING FARMER'S PROFITS

• Note: all prices basis central SK (except corn basis MB)

• For the 2024-25 crop year, as of March 19, 2025, SEGES MARKETS is above average elevator prices on 23 of 23 crops by over a $1.00/bu which if you assume 40 bu/acre on a 5,000-acre farm is a $200,000 gain over average elevator prices.  Gains over average prices will continue to increase if prices move lower.  
• Overall, crop prices were less volatile this year than the recent years limiting potential gains versus other years.
• Large gains are currently expected for canola, green lentils, chickpeas and mustard with good returns for wheat, corn and peas.

• For the 2023-24 crop year,  SEGES MARKETS was above average elevator prices on 22 of 23 crops by a $1.88/bu which if you assume 40 bu/acre on a 5,000-acre farm would be a gain of over $376,000 over average elevator prices.      
• Five crops that have saw large declines in price during the crop year were mustard, canola,  corn, chickpeas, soybeans, SEGES MARKETS has heavily sold early for all six of these crops.
  • For mustard, SEGES MARKETS average selling price was $10.75/bu over the average elevator price. Assuming 20 bu per acre, is a gain of over $34,000 per quarter section.
  • For canola, SEGES MARKETS average selling price was $2.49/bu over the average elevator price.  Assuming 40 bu per acre results in a gain of just under $16,000 per quarter section (just under $500k on 5,000 acres).
  • For corn, SEGES MARKETS average gain was over $1.09/bu over the average elevator price.  Assuming 100 bu per acre, the gain was over $17,000 per quarter section.
  • For chickpeas, SEGES MARKETS average gain was $3.40/bu over the average elevator price.  Assuming 30 bu per acre, thr gain was of over $16,000 per quarter section.
  • For soybeans, SEGES MARKETS average selling price was $1.57/bu over the average elevator price.  Assuming 30 bu per acre, is a gain of over $7,500 per quarter section.
• SEGES MARKETS also timed the sales for green peas, small green lentils, and large green lentils well with gains from $2/bu to $4/bu and was significantly short spring wheat going into the new crop year.   

• For the 2022-23 crop year, the two major crops that saw large price decreases during the year were flax and oats.  SEGES MARKETS aggressively sold both of these crops, more than any of the other crops.  
• For flax, SEGES MARKETS' average selling price was $22.88/bu.  The average elevator price for the crop year was $16.21.  The elevator price on July 31 was $12.75/bu.  SEGES MARKETS recognized in early December that demand for flax was dead, long before AAFC changed their projected flax exports from 375 kt to 150 kt and flax carryout from 100 kt to 275 kt (on February 17, 2023).  In contrast, on December 12, SEGES MARKETS sent out their 2022-23 flax S&D projection, indicating flax exports of 115 kt and a carryout of 330 kt, well over two months before the AAFC changed their numbers. Flax was still trading $19/bu at this time.   Assuming 25 bu/acre, the difference between the SEGES MARKETS' return and the average elevator return gain of  $27,000 per quarter section.
• For oats, SEGES MARKETS' average selling price was $5.42/bu.  The average elevator price for the crop year was $3.94/bu.  The elevator price on July 31 was $3.86/bu.  In early December, SEGES MARKETS was showing the 2022-23 carryout for oats at 1.1 mt, the highest oat carryout since 2013-14.  AAFC did not change their carryout for oats from 0.7 mt to 1.2 mt until December 16, 2022.  Assuming 100 bu/acre, the different between the SEGES MARKETS' return and the average elevator return is a gain of $24,000 per quarter section.
• Overall, SEGES MARKETS was ahead of average elevator prices by more than a dollar fifty per bushel and was above average elevator price on 14 of 15 crops. Assuming 40 bushels an acre on 5,000 acres this works out to a gain of more than $300,000 per 5,000-acre farm.    

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From May 2023: (before May 12, 2023 USDA WASDE report and first official 2023-24 US and World estimates):

[From May 10, 2023]

"Seges Markets...  ...Big Picture analysis before the USDA report...

... The Trade Estimates are suggesting lower prices as we move forward (and mostly supported by IGC), especially for corn which could drag wheat and soybeans prices lower as well.  We are 100% sold on oilseeds and corn.  It is likely prudent to get shorter wheat, i.e., move to 100% sold old crop...."  

"[From] ... May 9, 2023, Seges Insider weekly recommendation report [sent out May 11, 2023]. 

Canola:

• 2022 sales: We are 100% sold of 2022 canola production after our targets were hit last week.  
• 2023 sales: We are 40% sold of new crop canola. 

Soybeans:

• 2022 sales: We are 100% sold of soybean production after our targets were hit last week. 
• 2023 sales:  We are 30% sold of new crop soybeans.

Hard Red Spring:

• 2022 sales: We are 85% sold of spring wheat production. Sell remaining 15% of spring wheat at $10.45.
• 2023 sales: We are 30% sold new crop spring wheat futures..." 

[NOTE:  Unlike in May 2022 (see below) when Seges Markets was indicating higher prices for 2022-23 (and what happened), Seges Markets was indicating lower prices for 2023-24 (and what happened).  Seges Markets was heavily short major crops for 2023-24 long before the release of the May WASDE report which was very bearish.] 

From May 2022:

Here is SEGES MARKETS' general recommendations (word for word) from May of 2022 for the 2022-23 crop year as outlined in a SEGES MARKETS Big Picture Insider report (pretty much exactly what happened)

World Grain (wheat, coarse grain [corn, barley, sorghum, oats...] and rice) 

• Big Picture: continuously lower world grain ending stocks are not sustainable.  In general, expect higher grain prices than last year.

World & US wheat

• Big Picture: after many years of increasing world and US wheat stocks the trend is going the other direction.  Expect higher wheat prices than last year.

 World & US corn

• Big Picture: corn situation will be tight and may get tighter with further reductions in South American production for 2021-22 crop year.  Expect higher corn prices than last year.

World and US Soybeans 

• Big Picture: 40 mt of the USDA 46 mt increase in soybean production are increases in South American production.  Last year’s South American harvest is still on going so it will be months before there is any confidence in these 2022 numbers.  Expect vegetable oil prices to respond to changes in expectations for North American production the next 6 months while vegetable oil prices could be under some pressure at the end of the calendar year if these large increases in South American production appear possible.  

Strategy:

Grain prices should be higher than last year, especially if the war in Ukraine continues and Ukraine is unable to export their production, so we can be somewhat relaxed about pricing new crop grain production.  Oilseeds are more bearish, but this is highly dependent on South American production this winter.  If it looks like South American soybean production expectations will be realized, oilseed prices could come under some pressure. Energy prices will also come into play as more vegetable oils could get switched into the energy sector if crude oil prices remain strong.

[NOTE: As of March 8, 2023, the USDA had 2022-23 US wheat prices at $9.00/bu versus $7.63/bu in 2021-22, corn at $6.60/bu versus $6.00/bu and soybean prices $14.30/bu versus $13.30, respectively.  Soybean prices were saved by the drought in Argentina which put a damper on South American production (which SEGES MARKETS identified as a problem at the end of 2022).] 

For sign-up call, 204 489 1225, or send an e-mail to lklusa@segesmarkets.com