When studying oats futures historical price charts, one can see that demand tends to correlate with other feed grains, like corn, except that there is noticeably less volatility.
This is due to corn’s artificially high demand for manufacturing ethanol. Weather cycles and Canadian production, in particular, are important factors in oat futures prices. The USA has considerable infrastructure for processing oats and rely upon Canadian oat exports (with lower tariffs thanks to NAFTA) to make up for the shortfall in domestic production.
Oats Futures Historical Price Charts Vs Future Price Projections
News from the US Department of Agriculture and Statistics Canada on weekly North American production and supply, as well as CBOT daily charts and price reports and international statistics from the Grains Council of Australia (GCA) can help a trader get a clearer picture of the international oat market and historical oats prices versus future projections.
Oats Are Staple Food Crop
Similar to corn and wheat, oats are a staple food crop in the grains category with relatively widespread global production and consumption. Oats are major component of animal feed for horses, and to lesser extent, cattle, chicken and dog food, in addition to being a food for humans. Human consumption of oats takes a number of forms: as a cereal grain for granola or muesli or as a porridge, as a baking ingredient for breads and cookies, and as a soup thickener.
The UK has a long history of using oats for brewing beer and ale, and Scotland has long had an affinity for oats in their indigenous cuisine, which include Haggis and Sowans.
Medicinal Properties Of Oats
Other uses of oats include making straw beds for horses and cattle, as a skin softening agent for bathing additives and creams in the cosmetics industry, and as a medicinal agent in the treatment of urinary tract infections, dysmenorrhea, osteoporosis, and female menstrual irregularities. The chemical industry uses oats in the manufacture of plastics, solvents, and other products.
Oats Futures Contract Specifications
Oat Futures are trade on the Chicago Board of Trade (CBOT) under the ticker “O” on Open Outcry and “ZO” on the CME Globex. A single contract is 5,000 bushels, which is approximately 86 metric tons. Contract months are: March, May, July, September, and December. A tick equates to 0.0025 per bushel, or $25.00 per contract.
The last trading day coincides with the last business day before the 15th of any trading month. Contract settlement is by physical delivery.
Differentiating Oats Grades
There are several different deliverable grades of oats that are traded on the CBOT: Number 1 and Number 2 Heavy which are at contract par; Number 2, which is at a discount to contract price of 3-6 cents (depending on minimum test weight) per bushel; Number 1 Heavy, which is at a 3 cent premium; Number 2 Extra Heavy, which has a 4 cent premium, and lastly, Number 1 Extra Heavy, which has a 7 cent premium per bushel above contract.
In interpreting the data, it is helpful for a trader to be cognizant of the amount of acreage planted versus the actual crop yield, since oat fields may also be used for cattle grazing.
Where Are Oats Grown
Oats are sown and harvested around the globe, with Russia, Canada, USA, Poland, Finland, and Australia as the top producing nation over the last decade. Oats are usually grown in temperate climates and do not thrive well in hot temperatures, but are resistant to cold and frost, which makes it a popular crop in colder climates, such as those of Russia, Finland and Iceland. U.S. production has actually declined in direct lockstep with the drop in the horse population.
Domestic U.S. oat production hails primarily from Iowa, Minnesota, North & South Dakota, Wisconsin, and, surprisingly, Texas.
Study the Oats Futures Historical Price Charts
|Standard Oats Contract|
|Per Contract Size||5,000 bushels|
|Price Quotation||Cents per bushel|
|Minimum Price Fluctuation||1/4 of one cent per bushel ($12.50 per contract)|
|Termination of Trading||Trading terminates on the 15th calendar day of the contract month.|