Organic grain seeding going ahead as prices remain flat

Organic soybeans and most varieties of wheat are selling at a substantial premium compared to their conventional counterparts. Photo: iStock/Getty Images

By Adam Peleshaty
Glacier FarmMedia staff

A brief break from dry conditions across western Canada was a much-needed gift for organic grain growers, as the precipitation allowed them to seed more of their crops into the ground.

“(Seeding is) mostly complete, (it) will be in the next seven to 10 days. After the latest rain event, moisture and crops look very good,” Jason Charles of Pipeline Foods from Minneapolis, Minn. wrote in an email. “The crop is off to a good start but will need continued moisture to stay that way.  For now it seems the bloom is off the rose as it relates to wheat, corn, and to a lesser extent, bean prices. This will continue to pressure organics, again weather is key.”

He added that demand is slowing down as buyers transition away from old crop to new crop.

“Organics never did see the pop in price like conventional grains have since April 1. Some of this is due to early buying, much to do with freight increases. As mentioned, weather is key in order to determine which way organic pricing will go as we get into July and August,” Charles wrote, adding he does not expect big runs in organic pricing until December.

Jason Freeman, general manager of Farmer Direct Co-operative in Regina, Sask., mentioned there were two other factors contributing to the stagnation in organic grain bids.

“There are significant downward pressures on price, like the appreciating Canadian dollar, and upward pressure on pricing, like the dry conditions,” he wrote in an email. “As far as pricing goes, it’s tough to tell with the weather, although that rain was awesome and the US$/C$ exchange rate is very volatile. So we are waiting to see what happens at harvest, then we’ll have a better idea of pricing. The market seems to be strong enough, but there is significant carryover inventory of some organic grains.”

Scott Shiels, grain procurement manager for Grain Millers Canada Corp. in Yorkton, Sask., said organic grain growers are scrambling to find places to sell their crop no matter the price.

There is talk from quite a few producers about pulling some of their acres out of organic. – Scott Shiels

“Producers are calling us, who normally sell oats and flax, about all kinds of other commodities,” he added. “Normally, we run double and, in some commodities, triple the price compared to conventional (crops). Today, if you can get a bid of something, it’s maybe 50 per cent more and in some cases, it’s not even that…There is talk from quite a few producers about pulling some of their acres out of organic.”

The lack of price movement in western Canada does not seem to be as much of a problem in Ontario. Harro Wehrmann of Wehrmann Grain & Seed in Ripley, Ont. mentioned that proteins, including soybeans and peas, have seen price increases due to rising international demand as well as import restrictions in countries such as India.

Organic soybeans and most varieties of wheat are selling at a substantial premium compared to the conventional crop, but some corn producers are selling organic crop at par with conventional, according to Wehrmann.

While southern Ontario is also dealing with dry conditions, it is benefitting from slightly higher soil moisture than out west.

“Everything is planted except for soybeans and edible beans,” he said. “Wheat, barley, rye and spelt are looking very, very good…Corn is just emerging and (30 per cent of) soybeans have been planted. Dry weather is a bit of a concern.”