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November outlook for 2016-17 Annual and Winter Pools

Winnipeg – G3 Canada Limited today released updated Pool Return Outlooks (PROs) for the 2016-17 Annual pools and the first release for the Winter pools, including Futures Choice Pools. Compared to the October PRO, projected returns are up for canola, peas and unchanged for durum.  Wheat pool returns are projected slightly lower. Projected returns for wheat and canola Futures Choice pools are slightly lower.

G3 PRO (per tonne)
In store Vancouver or Thunder Bay
Annual Pool Winter Pool
Wheat 24-Nov 27-Oct 24-Nov
1 CWRS 14.5 298.00 302.00 298.00
1 CWRS 14.0 293.00 297.00 293.00
1 CWRS 13.5 288.00 292.00 288.00
1 CWRS 13.0 283.00 287.00 283.00
1 CWRS 12.5 279.00 283.00 279.00
1 CWRS 12.0 274.00 278.00 274.00
1 CWRS 11.5 269.00 273.00 269.00
2 CWRS 14.5 295.00 299.00 295.00
2 CWRS 14.0 290.00 294.00 290.00
2 CWRS 13.5 285.00 289.00 285.00
2 CWRS 13.0 280.00 284.00 280.00
2 CWRS 12.5 275.00 279.00 275.00
2 CWRS 12.0 270.00 274.00 270.00
2 CWRS 11.5 265.00 269.00 265.00
3 CWRS 13.0 268.00 272.00 268.00
3 CWRS 12.5 264.00 268.00 264.00
3 CWRS 12.0 260.00 264.00 260.00
3 CWRS 11.5 256.00 260.00 256.00

Durum
1 CWAD 13.0 380.00 380.00 387.00
1 CWAD 12.5 378.00 378.00 385.00
1 CWAD 11.5 375.00 375.00 382.00
1 CWAD 372.00 372.00 379.00
2 CWAD 13.0 365.00 365.00 372.00
2 CWAD 12.5 364.00 364.00 371.00
2 CWAD 11.5 361.00 361.00 368.00
2 CWAD 358.00 358.00 365.00
3 CWAD 13.0 335.00 335.00 342.00
3 CWAD 11.5 331.00 331.00 338.00
3 CWAD 329.00 329.00 336.00

Canola
1 Canada 537.00 526.00 540.00

Field Peas
2 Canada Yellow 330.00 315.00

Futures Choice
Annual Pool Winter Pool
24-Nov 27-Oct 24-Nov
Wheat Minneapolis July 2017 Basis Minneapolis July 2017 Basis
1 CWRS 14.5 31.00 35.00 29.00
1 CWRS 14.0 28.00 32.00 26.00
1 CWRS 13.5 24.00 28.00 22.00
1 CWRS 13.0 20.00 24.00 18.00
1 CWRS 12.5 15.00 19.00 13.00
1 CWRS 12.0 10.00 14.00 8.00
1 CWRS 11.5 5.00 9.00 3.00
2 CWRS 14.5 28.00 32.00 26.00
2 CWRS 14.0 25.00 29.00 23.00
2 CWRS 13.5 21.00 25.00 19.00
2 CWRS 13.0 16.00 20.00 14.00
2 CWRS 12.5 12.00 16.00 10.00
2 CWRS 12.0 7.00 11.00 7.00
2 CWRS 11.5 2.00 6.00 0.00
3 CWRS 13.0 5.00 9.00 3.00
3 CWRS 12.5 1.00 5.00 -1.00
3 CWRS 12.0 -4.00 0.00 -6.00
3 CWRS 11.5 -8.00 -4.00 -10.00

Canola
ICE July 2017 Basis ICE July 2017 Basis
1 Canada 6.00 8.00 6.00


Note: PROs are provided as price indications based on current nearby and forward markets. They are calculated basis track west coast or Thunder Bay ports, net of all projected operating costs, including G3’s pool management fee. Volatile market conditions may affect the PROs significantly. PROs are not price guarantees and should not be confused with initial payments. Farmers should consider entering pool contracts as an excellent risk-management tool that provides a solid return from the entire pooling period.

To calculate pool returns backed off to the farm, farmers should factor in country deductions that they negotiate directly with grain handlers. These deductions may vary at different times of the year.

PRO commentary
2016-17 pools
PROs for 2016-17 are based on the latest information available. Favourable weather in November has allowed the 2016 harvest to reach near completion in Alberta and Saskatchewan. In the U.S., both the corn harvest and planting of winter wheat are essentially complete.

Wheat markets have been fairly steady since the last PRO. While the nearby December Minneapolis contract weakened, then recovered back to where it was a month ago, the forward months have not recovered fully so the overall Minneapolis futures structure is lower with minimal carry through the May contract. This is the main driver behind the slight drop in the wheat pool returns. Durum market values have held firm over the past month. The supply of good quality durum remains relatively tight and demand is stable. Canola pool returns are higher based on stronger futures. Strong crush demand and good export demand continue to send futures values higher.

Compared to the PRO released October 27, wheat returns are $4 lower per tonne, and durum returns are unchanged for the Annual Pool. Canola returns are higher with the futures and peas have also increased by $15 per tonne for the Annual Pool.   

Given current PRO projections, producers in the 2016-17 wheat Futures Choice Annual Pool would anticipate a final return for 1 CWRS 13.5 in-store port position made up of the July 2017 futures value they lock in plus $24 per tonne. For the wheat Futures Choice Winter Pool, the projection for 1 CWRS 13.5 is the July 2017 futures plus $22 per tonne. 

For the canola Futures Choice Pools, the projected return is the July 2017 futures locked in plus $6 per tonne for the Futures Choice Annual Pool and the July 2017 futures plus $6 per tonne for the Futures Choice Winter Pool at in-store position. 

General pool assumptions:

  • Canadian dollar at 74 cents versus the U.S. dollar.
  • Current forward futures structure for wheat and canola.
November 24, 2016