ICE weekly outlook: Canola trade’s eyes on StatsCan report

ICE november canola
ICE November 2019 canola with 20-, 50- and 100-day moving averages. (Barchart)

MarketsFarm — Although Agriculture and Agri-Food Canada (AAFC) released its production forecast Wednesday, markets are focused on next week’s production report from Statistics Canada — a survey-based report which should provide a clearer picture of what’s to come.

AAFC’s August report kept the canola production estimate at July’s 18.575 million tonnes.

“Maybe we’ll see if the production numbers are close, who knows?” MarketsFarm analyst Bruce Burnett said of Statistics Canada’s report, due out Aug. 28.

Burnett revised his estimate from 17.85 million tonnes to 18.025 million.

One wildcard could come into play very soon: frost. Burnett has forecast single-digit low temperatures for parts of the Prairies for next week, raising the possibility.

Should that happen within the next 10 days, he said, AAFC’s and Statistics Canada’s numbers will change dramatically.

“We do have parts of the Prairies with extremely good conditions, just the crop is late,” Burnett said.

Other estimates for next week include 19.6 million tonnes from MarketsFarm analyst Mike Jubinville; 20.021 million, courtesy of FarmLink; and 19.3 million from Terry Reilly of Futures International.

Even though it has been widely accepted the 2019 canola crop will be less than the 20.343 million tonnes last year, expectations are for a bountiful harvest.

The canola harvest has yet to begin in earnest, but it’s underway in the Winnipeg area, said trader and farmer Bill Craddock.

The local crop does look very good, which could raise hopes of a strong harvest Prairie-wide.

— Reporting for MarketsFarm by Glen Hallick, with files from Marlo Glass.

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