Canadian Crop Update
-Monday, November 25, 2001
This analysis featured in the November 25, 2001 issue of the HGCA's MI Prospect, Volume 4, Number 10
Following severe drought conditions over much of central Saskatchewan and southern Alberta, Canada harvested its smallest crop since 1988. Quality is generally above average with good protein levels for wheat and generally favourable malting characteristics for 2-row barley outside the drought area. The shortfall in output will result in lower exports and minimal end of season stocks.
Canadian grain and oilseed yields this year are 15 percent or more below 2000 levels(See Table). The only exceptions to this are maize and soybeans, which are grown almost entirely outside of the main Prairie grain growing area.
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Canadian Supply & Dispostion, Wheat, Barley and Canola
------All Wheat-------- --------Barley--------- -----Canola/OSR-----
'95-'00 '00-'01 '01-'02 '95-'00 '00-'01 '01-'02 '95-'00 '00-'01 '01-'02
5yr.avg est. F'caste 5yr.avg est. F'caste 5yr.avg est. F'caste
Area,
'000 hct 11,168 10,963 10,971 4,458 4,551 4,376 4,915 4,816 3,829
Yield,
t/hct 2.33 2.44 1.89 3.05 2.96 2.54 1.39 1.48 1.25
Supply and disposition
'000 tonnes
Prod. 26,010 26,804 20,695 13,605 13,468 11,103 6,866 7,119 4,789
Carryin 6,979 7,749 9,208 2,335 2,988 2,454 636 2,156 1,054
Imports 57 60 55 30 50 70 124 224 250
------ ------ ------ ------ ------ ------ ----- ----- -----
T.Supply 33,047 34,613 29,958 15,971 16,506 13,627 7,627 9,499 6,093
Exports 17,719 16,450 15,800 2,741 2,550 1,700 3,214 4,838 2,900
Dom.use 7,934 8,863 8,058 10,662 10,906 10,227 3,473 3,607 2,793
Carryout 7,393 9,300 6,100 2,569 3,050 1,700 939 1,054 400
T.Disp. 33,047 34,613 29,958 15,971 16,506 13,627 7,627 9,499 6,093
Source; AGRICULTURE AND AGRI-FOOD CANADA , Nov. 1, 2001
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For wheat the combination of a normal area and drought-reduced yield has lowered Canadian output by about five million tonnes, or 20 percent, from typical levels. As carry-in stocks were relatively high at the start of the season, Canada is relatively well placed to sustain much of its usual export programme.
And as most of the crop was harvested in good condition, US corn will be imported to replace lower quality wheat normally fed to livestock and poultry. Canadian wheat exports are, therefore, expected to decline by only about two million tonnes, or 10 percent, from normal levels.
With a high protein crop, premiums for better quality hard red spring wheat have narrowed.
Durum wheat grown mainly in the worst effected drought areas was particularly badly effected. But as the Canadian carryover at the start of the season was ample, exports are expected to increase.
For barley the production situation is similar to wheat. The 2001 harvest is about 2.5 million tonnes, or about 18 percent below normal. By historic standards carry-in at the beginning of the season was not large. Some lowering of carry-over stocks is anticipated as well as imports of US corn for feed purposes.
Exports will, however, be reduced by more than a million tonnes or almost 40 percent from usual levels. And exports will be restricted to malting quality barley. Prices for feed barley in the Prairies, ranging up to the equivalent of £65 to £70 per tonne, have risen close to FOB values. With £20 per tonne for freight and handling to ports, any barley not meeting malting specifications is most likely to be fed at home.
Canada has a long standing and premium feed barley market in Japan that it could lose at least this year to Australia. In all probability this will indirectly improve European prospects in the Saudi market later in the year. It also seems likely Canada will have a struggle supplying its traditional quality malting barley markets in eastern Asia.
Canadian canola/OSR markets last year were burdened with abundant supplies. Despite record exports and domestic consumption, end of season stocks were large. As a result of low prices Canadian farmers reduced 2001canola seeding by 20 percent and with yields a further 10 percent below average, output was more than 30 percent below typical levels. All three components of disposition - domestic consumption, exports, and carry over will be squeezed.
David Walker
phone: 01603 705153
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