While the first formal estimate of the Canadian field crop production is not published until August 23, it is now clear that drought conditions have reduced Canadian grain output below last year's level which was itself the lowest since 1987.

It was already evident this spring that an average crop was the best that could be expected even with favourable rainfall. Below average winter precipitation had done little to alleviate last summer's drought, although geographically it had moved north and west. By mid June concerns over the crop were with its late development rather than drought, a relatively small area in north eastern Alberta apart.

But just as crops, with no subsoil moisture reserves to draw on, became dependent on rainfall in early July, the weather turned hot and dry. And in not much more than two weeks the damage was done.

The drought area, which covers most of central Alberta, see map, is an important production area for two-row barley. Canola/OSR is also a major crop in this region. To the south and east, where wheat is more dominant, crops have been less badly affected.

The 2002 Canadian barley crop is projected to be as much as four million tonnes below typical output. As Canadian barley exports only exceed three million tonnes in a good year and there is no carryover to draw on, Canada is "statistically" out of the export market. Surely domestic consumption will be squeezed and corn will be imported from the US mid west. But feed and forage supplies are if anything more seriously effected than grain and importing US corn is costly.

Feed barley is already trading at the equivalent of about £75 per tonne on an ex Alberta farm basis and, because of the difficult growing conditions, even before the hazard of harvest it is evident malting quality barley is likely to be in even shorter supply. The bottom line is that very little Canadian barley, malting or feed, will find its way onto world markets this season.

The wheat situation is less dire as the worst effected drought area is not a major wheat producer. But Canadian exports of non durum wheats are still likely to be about half what they normally are. Paradoxically as the Canadian durum wheat area increased this year and is outside the drought areas durum supplies will increase.

Much of the Canadian canola crop is produced outside the drought area and a reduction in carryover stocks will augment a smaller harvest, although Canadian canola exports will also be reduced. In contrast to last year, supplies of heavy oats for speciality market are likely to be adequate following an increase in acreage outside the drought area.

David Walker
phone: 01603 705153