PRAIRIE ROUTES
NEWS

Good morning, spring-like warmth will persist across the Canadian prairies this week, with daytime highs of 5°C to 12°C in Alberta and southern Saskatchewan, and –2°C to 5°C further east in Manitoba. Mostly sunny skies and light winds will dominate, with only isolated light flurries possible in the northeast, easing conditions for livestock and field access. A weak system late week may bring cooler air and minor precipitation to eastern areas, but overall above-normal temperatures continue.

MARKET PULSE

Commodity Market Update

Mar & Apr Futures Brief for February 11, 2026

Grains rebounded on China demand optimism while livestock futures consolidated near multi-month highs. Natural gas found a floor near $3.70 after last week's weather-driven collapse. Gold stabilizes above $5,000 as spec positioning rebalances. For Prairie producers: USDA's February WASDE raised beef/pork prices across all quarters while trimming poultry, watch for export momentum. China soybean purchases tracking 20 mmt this season support forward pricing opportunities. Spring planting intentions forming amid stable canola near CAD $665/t and wheat holding $5.30.

Crude Oil (Mar '26): $64.78/bbl (up 8% past month, consolidating near $65). Iran-US geopolitical premium persists but capped by orderly US shale production growth and softer global demand forecasts. April crude: $64.59 with modest backwardation signaling near-term supply comfort.

Natural Gas (Apr '26): $3.72/MMBtu (March near $3.70, stabilizing after multi-week selloff). Market anchored by mild late-winter forecasts through mid-February. Production near record highs but LNG export volumes and Northeast cold prevent further collapse. Floor established $3.65-$3.75 range.

Gold (Apr '26): $5,050/t.oz (settled into $5,020-$5,060 zone after January peak $5,608). Silver: Rebalancing after 13% correction. Long-term safe-haven buying intact; speculative positioning cautiously rebuilding. Watch $5,000 floor—break below triggers spec liquidation.

Corn (Apr '26): $4.42/bu (March $4.28-$4.30). USDA WASDE trimmed domestic carryout, raised exports 100 mbu—ending stocks low-2.1 billion bu range. Feed/ethanol demand signals improved. Brazilian/Argentine precipitation forecasts cap rallies near elevated levels.

Soybeans (Apr '26): $11.45/bu (March $11.15-$11.20, two-month high). China committed 20 mmt this season, 25 mmt next season—12 mmt delivered by late-January. Renewed export optimism pulling spec demand curve up 20-30 cents. Strong Chinese crush-margin dynamics support.

Wheat (Apr '26): $5.35/bu (March $5.28-$5.34, recovering from sub-$5.20 lows). Carry-in stocks high globally (US/Black Sea) but late-winter cold in Plains/Southern Russia/Eastern Europe underpin small risk premium. Still 8% below year-ago levels.

Live Cattle (Apr '26): $239/cwt (down from $242-$244 spike). Packers rebalanced margins; lighter cash trade. CME Feeder Index: $373.83 (down $0.83 Feb 6). USDA raised fed-cattle prices all quarters on tight supplies and resilient demand.

Lean Hogs (Apr '26): $97.25-$99.50/cwt (down from multi-month highs). CME Lean Hog Index: $86.50-$86.70. Strong packer margins, steady hog access, firm retail demand. USDA raised hog prices all quarters; pork exports up on improved competitiveness.

Not financial advice.
Data sources: Trading Economics, Barchart.com, USDA WAERS, CME Group, DTN Progressive Farmer, AAFC, Farm Credit Canada

TRENDS

📈 The Bulls and 📉 The Bears

📈 Bullish:

• USDA February WASDE Lifts Livestock Prices Across All Quarters; Beef/Pork Exports Rise on Strong Demand - USDA's February 9 WASDE report raised beef and pork production forecasts while trimming poultry due to HPAI culling. Beef production increased on higher steer/heifer/cow slaughter and heavier dressed weights. Fed-cattle and hog prices raised all quarters. Beef imports rose on strong demand for lean processing beef; pork exports increased on improved competitiveness. All-milk price lifted to $18.95/cwt.

• Treasury's 45Z Low-Carbon Fuel Tax Credit Delivers $0.70-$0.75/Gallon for Ethanol-CCS Operations; "North American First" Strategy Cements Domestic Ag Advantage - The 2026 IRS §45Z regulations finalized February 9 clarify that ethanol plants with carbon capture/sequestration (CCS) can achieve Carbon Intensity scores of 12-15, unlocking credits of $0.70-$0.75/gallon—nearly three times the value of the §45Q carbon credit. The guidance cements a "North American First" strategy excluding foreign feedstocks and standardizing credit rates to ensure the multi-billion-dollar incentive fuels domestic agricultural and energy independence through 2029.

• AgTech Innovations Transforming Farming in 2026: AI-Driven Advisory, Field Robotics, and Biologicals Reach Commercial Scale - ICL Group's 2026 AgTech outlook highlights five transformative trends reaching commercial adoption: biologicals integrated into digital agronomy tools, field robotics addressing labor scarcity (Yamaha-Robotics Plus consolidation signals scale readiness), AI-driven input optimization becoming the "connective layer" across production cycles, and climate-resilience stacks (real-time moisture sensors, genetics for temperature extremes, precision fertilization). Autonomous tractors, robotic sprayers, and crop-specific harvesters proving consistent labor reduction and input precision.

📉 Bearish:

• World Bank Forecasts Six-Year Commodity Price Lows by Late 2026; Oil Surplus and Slower Chinese Growth Drive "Deflationary Period" - World Bank's February 6 report predicts six-year lows in commodity prices by late 2026, citing a "deflationary period" in energy markets alongside slower Chinese industrial expansion. The report highlights a potential massive global oil surplus, with Brent crude averaging $60/bbl and WTI in mid-to-upper-$60s (down from $80+ in 2024). The extended price slump creates budget strains in resource-rich producer countries but welcomed by central banks seeking to tame inflation.

• Canada's Digital Agriculture Adoption Lags Global Peers; Regulatory Uncertainty and Fragmented Ecosystem Blunt On-Farm Technology Integration - Despite IoT, robotics, and AI-powered solutions reshaping farming in 2026, Canada's digital agriculture adoption lags peer countries (Australia, Netherlands, Israel) that implemented comprehensive digital ag frameworks. Large grain operations lead adoption; smaller farms and horticulture lag significantly. Regulatory uncertainty around data ownership and fragmented ecosystem blunt on-farm adoption even as technologies prove ROI (15% fuel reduction, 10% yield gains from GPS in Alberta).

• Natural Gas Market Sits at "Hard Floor" Near $3.70 as Mild Weather Forecasts and Record Production Cap Upside Through Spring - Natural gas markets tested $3.00/mmbtu in early February with March-April strip dipping toward $3.70-$3.80 before rebalancing. Primary bearish pressure stems from forecasts of mild temperatures through late-February and early-spring, suppressing gas-fueled heating demand across continental US. EIA reports storage levels near seasonal averages; LNG exports at record levels constrain dramatic price drops but limit upside.

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INCASE YOU MISSED IT

Quick Hits on Policy and Relevant News

🔬 MANITOBA SEED GROWERS CRITICIZE AAFC RESEARCH CUTS AS THREAT TO FOOD SECURITY AND RURAL ECONOMIES
Manitoba Seed Growers' Association criticized AAFC budget cuts on February 5, stating "cuts to Agriculture and Agri-Food Canada threaten the foundation of our nation's food security, rural economies, and environmental resilience." The association emphasized cuts are "not simply numbers on a balance sheet—they are cuts to the programs, research, and partnerships that sustain Canadian consumers, farmers, agri-entrepreneurs, value-added opportunities, and communities." Policy analysts suggest 15% AAFC budget trim may redirect focus but provincial groups demand urgent consultation on research alternatives.

🌾 CANADA LAUNCHES $75 MILLION AGRIMARKETING MARKET DIVERSIFICATION PROGRAM; APPLICATIONS OPEN FEBRUARY 13 FOR SMEs AND NATIONAL ASSOCIATIONS
Minister Heath MacDonald announced February 9 at Food and Beverage Canada's Policy Breakfast two new AgriMarketing Program streams: Market Diversification for National Industry Associations and for SMEs. $75 million invested over 5 years (2026-27 to 2030-31) to support ag/agri-food/fish/seafood sectors responding to market instability by encouraging greater market diversification. Applications open February 13, 2026. Funding separate from $129.97M previously announced under Sustainable CAP. Particular focus on sectors most affected by trade barriers (canola, pulses, pork).

💰 FCC FORECASTS CANADIAN HOG SECTOR STRONG MARGINS IN 2026 ON LOWER FEED COSTS AND EXPORT DEMAND
Farm Credit Canada senior economist Justin Shepherd reported January 29 (updated Feb 10) that strong demand for Canadian pork and lower feed costs will support hog margins in 2026. FCC forecasts hog prices slightly above 2025 figures and well above five-year averages. Cattle futures near record levels provide support for hog market as substitute protein. Ample feed grain supplies expected to hold prices below five-year average throughout 2026. Manitoba and Ontario farrow-to-finish hog margins could reach highest levels in five years. Disease (ASF, PED, PRRS) remains ever-present risk.