Canola stocks comfortable, eyes on new crop

CNS Canada — Canadian canola stocks are rather large heading into the new growing season, but attention now is firmly on new-crop production.

Statistics Canada on Friday pegged canola supplies in the country as of March 31 at 9.1 million tonnes, the second-largest on record for that time of year and about 1.1 million tonnes above the stocks on hand at the same point in 2017.

“The canola number came in a shade below expectations, but it still confirms that we’re headed towards a pretty good (ending) stocks number this year,” said Ken Ball of PI Financial.

The big stocks, he said, should also be seen as confirmation that the Statistics Canada production estimate for 2017 of 21.3 million tonnes wasn’t overstated, as some industry participants had speculated.

“We will still have a fairly decent carryout. We’re not short on canola,” said Mike Jubinville of ProFarmer Canada.

End-user demand from both exporters and domestic crushers is running behind the year-ago pace, but is still solid overall.

“While the stocks are comfortable, there’s still not much room for any significant adversity,” said Ball, noting attention now is focused on new-crop production.

He described conditions across Western Canada as variable, with the western Prairies on the wetter side and the eastern Prairies very dry.

Wheat stocks as of March 31 were pegged at 16.4 million tonnes, down by about 600,000 tonnes from the same point the previous year. Declines in durum accounted for all of the change, with stocks of that crop at 3.4 million.

Barley stocks were on the tight side, down 25 per cent on the year at 3.4 million tonnes. Jubinville said the tighter barley stocks were showing themselves in the cash market, which has shown some strength through the winter.

Pea and lentil stocks were both up on the year, confirming the poor export demand for the crops since India backed away from the global pulse market.

— Phil Franz-Warkentin writes for Commodity News Service Canada, a Glacier FarmMedia company specializing in grain and commodity market reporting. Follow him at @PhilFW on Twitter.

Table: A recap of Statistics Canada’s stocks report for the period ended March 31, 2018, in millions of metric tonnes.

* – “All wheat” includes durum, spring and winter wheat