PRAIRIE ROUTES
NEWS

Good morning, the Canadian Prairies will experience mostly mild and dry conditions this week with temperatures above seasonal averages. A weak Pacific system will bring light snow and rain to southern Alberta and Saskatchewan midweek, producing only minor accumulations. Daytime highs will generally range from 7 to 12 °C, warmest early in the week. By late Friday and the weekend, a cold front brings a brief shot of Arctic air with temperatures dropping toward seasonal or slightly below normal, especially in eastern areas. Winds will increase Friday, mainly in Manitoba, raising frost risk overnight into early next week. Overall, expect mostly settled weather with periodic cold snaps but no major storms in the short term.

MARKET PULSE

Commodity Market Update

Corn is holding steady near $4.28¾, down 1 cent Tuesday, within a narrow trading band as the market awaits Friday's USDA Crop Production report. Harvest is 92% complete according to analyst polls, slightly behind last year's 95% pace. December contracts face resistance at $4.36½ with support at the 20-day moving average of $4.24¼. Export inspections remain solid at 1.425 million tonnes for the week ending November 6, above last year's 807,000 tonnes.​

Wheat is trading mixed across classes. December soft red winter wheat (WZ25) is down 2¾ cents at $5.33/bu, while Kansas City hard red winter (KWZ25) is down 5¼ cents at $5.21¾, and Minneapolis spring wheat (MWEZ25) is down 2½ cents at $5.61¾. Traders are squaring positions ahead of Friday's USDA report. Export inspections for the week ending November 6 totaled 291,000 tonnes, below the prior week's 350,000 tonnes. Russian consultancy SovEcon's first November estimate: 4.7 million tonnes of wheat exports.​

Crude oil is holding near $60.46/barrel on Monday, up 0.55% from the previous day, as traders await OPEC and IEA market outlooks this week. Dollar weakness on Monday provided support, and strength in Chinese crude imports (up 3.1% year-over-year through October to 471 million tonnes) is supportive. December WTI closed Friday down $0.42 at $60.14, but Monday's rebound shows some stabilization around the $60 level.​

Natural gas is trading volatile near $4.31/MMBtu as weather patterns shift. The market gapped higher to $4.47 early in the week amid cold snap development across the US. Seasonal demand remains strong through the winter months, with traders viewing it as a "buy-only market" through February. LNG exports remain robust at absorbing excess US supply.​

Livestock saw a dramatic reversal Monday. December live cattle shot up 7.2 cents to close at $228.55/cwt, while January feeder cattle surged its daily limit of 9.25 cents to $328.825/cwt. The strength followed sharp Friday declines and was fueled by spillover from broad market strength, Trump's comments about examining the packing industry, and ideas that futures were oversold relative to cash prices. CME expanded daily limits to $10.75 for live cattle and $13.75 for feeders. December lean hogs rose 3.375 cents to $82.775/cwt on momentum from cattle and ideas that hogs were too cheap relative to cash.​

How to position into the day

Soy / Grains: Beans consolidating near $11 support; watch for Friday USDA report. Corn steady but vulnerable if yields surprise higher. Wheat mixed ahead of USDA; traders squaring positions.
Energy / Oil: Crude stabilizes near $60; OPEC and IEA reports Wednesday-Thursday are key catalysts. Dollar weakness supportive but surplus concerns persist.
Natural Gas: Seasonal buy signal; cold snap provides support. LNG exports strong. Trade with bullish bias through winter.
Livestock: Cattle and hogs bounced sharply Monday; watch for follow-through. Cash price strength provides floor. Sentiment remains fragile given political noise.

Not financial advice.
Data sources: Producer.com, Barchart.com, TradingEconomics.com, ADMIS.com, DTN Progressive Farmer

TRENDS

📈 The Bulls and The Bears 📉

📈 Bullish:

• Government Shutdown Nears Resolution; Risk-On Mood Lifts Livestock Futures - December live cattle surged 7.2 cents Monday to $228.55/cwt and January feeders hit their daily limit of 9.25 cents, closing at $328.825, after news that Senate Democrats broke ranks to advance a government reopening bill Sunday, sparking optimism that the shutdown could end soon. Risk-on sentiment lifted all commodities on hopes that economic growth would resume and energy demand would strengthen.

• USDA Crop Report Friday Could Trim US Yields; Soybean Production Cut Likely - Traders await Friday's USDA November Crop Production report with expectations that US soybean yield estimates will be trimmed from October levels. StoneX already cut its forecast to 53.6 bu/acre, suggesting the USDA could follow suit. If soybean production declines significantly, it could support January futures above $11 ahead of spring planting decisions.

• Chinese Export Eligibility Restoration for Three US Firms Signals Trade Thaw - China restored export eligibility for three US agricultural firms starting November 10 and suspended retaliatory tariffs on US agricultural products, representing a concrete step forward from the Trump-Xi APEC meeting. While the 13% tariff on soybeans remains and COFCO's Brazilian purchases dominate recent flows, the tariff suspension removal is a bullish signal for longer-term US soybean demand.

📉 Bearish:

• Chinese Soybean Purchasing Flows to Brazil, Not US; COFCO Inks $10B Deal - Despite China's tariff suspension and export eligibility restoration, COFCO announced it signed agreements to purchase Brazilian soybeans, soybean oil, palm oil and other agricultural products totaling nearly 20 million tonnes worth over $10 billion, with zero mention of US farm goods. This underscores China's preference for Brazilian supplies even with tariff headwinds removed, suggesting US soybean demand recovery will be gradual at best.

  AAFC Budget Slashed 15%; Research and Breeding Programs at Risk - The federal government's 2025 budget includes a 15% operating budget cut to Agriculture and Agri-Food Canada over three years. A move that could undermine public research, breeding programs, and extension services critical to long-term sector productivity. Grain Growers of Canada warned this jeopardizes innovation and competitiveness. Additionally, extended interswitching (which expired March 2025) was not restored, eliminating a competitive rail-shipping tool.

  Canola Retreats from Six-Week Highs as Vegetable Oil Complex Weakens - Canola has retreated from CAD $634.50 six-week highs down to CAD $632.50 as profit-taking combined with broader weakness in palm oil pricing to reduce crush margin support. Chinese tariffs at 75.8% remain an impenetrable wall with no relief timeline visible. Harvest completion and higher official production estimates increased near-term supply pressures.

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INCASE YOU MISSED IT

Quick Hits on Policy and Relevant News

📋 Federal Budget 2025: Trade Focus with AgriFood Budget Cut 15%
The 2025 budget emphasizes trade diversification with $75 million for AgriMarketing, $32.8 million for CFIA market access, and $8 million for Asia-Pacific relationships. However, Agriculture and Agri-Food Canada faces a 15% operating budget cut over three years. A concern for public research and breeding programs. Capital gains tax relief was made permanent, benefiting family farm succession planning.

🚂 Extended Interswitching Not Restored; Rail Competition Tool Lost
The federal budget did not restore extended interswitching, which expired March 2025. Grain Growers of Canada warns this removal eliminates a key tool for controlling shipping costs and holding rail carriers accountable. The group is calling for Port of Vancouver to be added to major federal projects as Canada's primary export gateway.

🌾 Manitoba Harvest Complete at 97%; Winter Crop Off to Strong Start
Manitoba's 2025 harvest wrapped at 97% complete with favorable conditions for winter wheat and fall rye planting. Pea yields ranged 30–70 bu/ac with average hay yields and variable forage quality.

🇨🇳 China Restores US Export Eligibility but 13% Soybean Tariff Remains
China restored export eligibility for three US agricultural firms and suspended retaliatory tariffs, but the 13% baseline tariff on soybeans stays in place. COFCO simultaneously signed a $10 billion deal for Brazilian soybeans, underscoring China's preference for South American supplies.

🐄 Investment Freeze Grips Manitoba Livestock Sector Amid Trade Uncertainty
Hog barn construction in Manitoba has stopped despite ideal market conditions, with new facilities costing $15–20 million each. Manitoba's pork sector produces 8–8.5 million pigs annually and supports 22,000 jobs. Trade policy uncertainty is paralyzing expansion across beef, pork, and poultry sectors.

📊 Natural Gas Rallies on Cold Snap; Winter Demand to Support Prices
Natural gas futures gapped higher to $4.47 as cold snap development increased heating demand expectations. Traders view the market as bullish through February with strong seasonal winter demand and robust LNG exports.

🌍 Australia Harvest Underway; Drier Conditions Limit Late-Season Rainfall
Australian winter wheat and canola harvesting is underway with drier conditions across most regions. Late rainfall will provide limited benefit as crops mature. Cotton and sorghum planting will follow, requiring more moisture.

🐮 Feed Grain Supplies Ample for Winter; Barley Production Up 11%
Canadian barley production is forecast at 9 million tonnes (up 11% from 8.1 million last year), with 5–6 million tonnes of hard red spring wheat expected to grade as feed. December feedlot placements are 12.2% below last year, suggesting on-farm feeding could increase.