Analyst says large world grain supplies, politics are weighing on wheat and canola prices

A grain market analyst sees limited upward movement for new crop wheat and canola this fall.

Neil Townsend with FarmLink Marketing Solutions said wheat is expected to be around $6.50 to $6.75 a bushel, depending on quality.

As for canola, he suggested a range from $9.50 to $9.75 a bushel.

“There’s two barriers for sustained higher prices for canola: one would be the China issue with Canada, and the second is a global glut of oil seeds led by the United States,” said Townsend.

He also mentioned how some of the high quality Canadian wheat may be shipped to the U.S. because of low quality in the U.S. winter wheat harvest.

Another factor in play is how Argentina has a big crop and may set a new record for wheat shipments in the coming year.

But overall, Townsend feels political uncertainty is what’s not supportive for improving grain prices.

“Canada is facing obstacles with China and maybe still has some issues with India, so the politics don’t look too favourable for higher prices either.”

All these elements could have a weighing effect on the market for prairie farmers.

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