Market Signals from Weekly Data
More market transparency, information about how crops are being traded, is always a desirable goal. Timely information about sales and prices helps us do a better job of tracking supply and demand developments and gives us a clearer picture of what’s ahead. Ideally, if farmers and grain merchants would both provide information about the crops they’ve sold and the prices they’ve received, it would fill in a lot of the missing pieces in the market puzzle. But we’re not holding our breath.
Until that happens, we have to work with the information that’s available. While StatsCan is the data source most often mentioned (and criticized), the Canadian Grain Commission provides useful weekly data which offers some clues about market status and strength. This data includes commercial inventories at country elevators and at export terminals, farmer deliveries, shipments from country elevators and exports, among others.
Admittedly, there are some gaps in the CGC data but in our view, the three most important are farmer deliveries, elevator shipments and exports. If we think about the export pipeline, the leading market signal comes from the pace of farmer deliveries, as supplies are pulled into the handling system. Next, the weekly shipments out of country elevators are a strong indicator of how much of a crop is needed at the ports or to be moved south into the US or Mexico. Finally, weekly exports are reported, which shows how much is on its way to other countries. Other bits and pieces of data add more context.