It is cold outside, but of course it is January of the new year and that's about what we can expect. I know there are some farmers in Ontario still waiting to get their corn harvest in. Heavy snow and cold weather will certainly make that difficult and much of it won't be done until the spring. Let's hope the weather will be a little kinder in 2026. However, as all farmers know every year is different.

Some of you have surely started your new crop pricing for 2026 and beyond. In Ontario, it is always a bit difficult to get that done as the value of the Canadian dollar continues to fluctuate. It ended the year just under $0.73 US gaining a couple cents during the last couple of weeks. If you think the Canadian dollar is going to be the same by the end of the year, you can just rest easy, but if you think it's going to be $0.85 cents US on Jan. 1, 2027, maybe we all should be immediately contracting cash grains in Ontario and Quebec. That's how much impact the value the Canadian dollar has on our cash prices and by extension our farm income.

So where do we go from here? It's a good question and something that is very personal to every farmer. This is my 40th year of writing this column and it has giving me some pretty good insights on farmer behavior. For the most part, even after all this time, many farmers would rather do any other aspect of their job versus selling and buying grain. I cannot comment on the livestock side of it. I am just saying that farmers have many interests in agriculture, but when it comes to marketing, it's one subject there's not a lot of interest in.

I almost chafed when I write that. With my background in agricultural economics, I often think of the farm income/revenue side as the raison d'etre of agriculture. However, I've noticed through the years that farmers have much greater interest in agronomy, farm machinery and probably a whole host of other things versus the price discovery of their own grain. That is not a criticism -- it's just something I've noticed. In lieu of that, I always tried to make my comments about grain pricing very simple. Farmers don't want complexity; they much prefer the bottom line, and they much prefer what that means to their cash grain prices versus some fancy complex theory about grain futures.

That's not a condemnation of grain price analysis, I just think of it as a simple reality. In Ontario and Quebec its further demonstrated by the fact that the volatility of the Canadian dollar adds another layer to our grain marketing equation. That means at the end of the day cash price realities tend to me more real than any grain futures price gyration. However, understanding and finding the truth behind some of the cash market realities concerning basis in certain parts of eastern Canada can be very frustrating to decipher. Grain merchandisers keep information close to their vest.

For the record, in 2025 soybean prices were up about 9% higher but a large part of that was due to that harvest rally in mid-October. That came out of nowhere mainly because of some misleading social media posts and other news stories. Also, in 2025 corn was down 4% on the year. Wheat was also down 4% on the year but keep in mind it was down 12% the year before. At the end of the day, you could argue the last two years of grain marketing haven't yielded very well. However, that should never stop us from trying to get better at it and making sure daily market intelligence is the key to knowing when to pull the selling trigger.

Keep in mind that all of this is fluid, or in other words it's changing all the time. For instance, last year there was an increase in the price of feeder cattle by 35% and live cattle were up 20% for the year. All of these values are relative, as we all know that beef prices were higher. It just goes to show you never know when a market will turn around. At the same time, we need to recognize over long periods of time most of these agricultural grain markets are fairly stable and are trading at relatively low levels.

On the record, March 2026 corn finished the year out at $4.41 a bushel. The March 2026 soybean futures closed down $0.15 on the last day of the year at $10.47 a bushel. Not to be outdone, Chicago wheat finished the year at $5.06 a bushel. Put these at the back of your mind and we'll check where we are a year from now. Hopefully, we will have some fireworks to make things go higher.

In between then and now, there will be a lot of growing season in Brazil and Argentina to interpret. When that's over, we will have our own growing season to get through.

A key part in managing risk is setting standard grain pricing orders at your local elevator or preferred processor. Setting them now is a good thing, possibly eight to 10 months ahead of actually gaining that production. During this time, you can take an active part in pricing that grain, sometimes when you are asleep, sometimes when you are greasing the planter. Having them all set up can grant peace of mind but also take advantage of very good, unusual market opportunities. Case in point was that unexpected soybean price rally last October.

I often price those market orders much higher than I could get today and sometimes even much higher than that. Simply put, it doesn't cost you anything and when a market anomaly comes along sometimes it turns into a pricing reality. Other times, like when the Russians first launched its war against Ukraine, it means you can sell Ontario wheat for $15 a bushel. However, you've got to have that standing market order in before the bombs go off.

The challenge for Ontario and Quebec grain farmers in January of 2026 will be to embrace the challenge. That means accepting uncertainty as part of the business, staying engaged with the cash grain and futures markets even when they are uninspiring, and recognizing that pricing opportunities rarely announces itself ahead of time. Discipline, patience, and a willingness to act when the moment presents itself will matter more. Our job as farmers, as it has always been, is to pounce on those opportunities when they appear.

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The views expressed are those of the individual author and not necessarily those of DTN, its management or employees.

Philip Shaw can be reached at philip@philipshaw.ca

Follow him on social platform X @Agridome

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