Large gap between StatCan, USDA canola estimates

MarketsFarm — There’s a significant difference in the amount of canola grown in Canada during 2022-23, in the estimate from Statistics Canada (StatCan) compared to that from the U.S. Department of Agriculture (USDA).

Earlier in December, StatCan’s survey-based production of principal field crops report pegged this year’s canola harvest at 18.17 million tonnes. That’s a drop of about 4.8 cent from the agency’s previous call of 19.1 million tonnes issued in September, derived from its modelling and satellite imagery used during the summer. StatCan based its latest production number on nearly 8.6 million hectares being combined, yielding a little more than 2.11 tonnes per hectare.

Meanwhile, in USDA’s world agricultural production report, the department placed the bounty of this year’s canola off of Canadian fields at 19 million tonnes, a 2.6 per cent reduction from its November projection of 19.5 million tonnes. The department came to that conclusion also on 8.6 million harvested hectares, but with a higher yield of 2.21 tonnes/hectare.

Aaron Mulhollen, USDA crop assessment specialist for Canada and the Caribbean, said the department considers the StatCan number to be preliminary rather than final. This was in sharp contrast in USDA fully accepting StatCan’s call on Canadian wheat output in 2022-23.

“We expect an increase to the current StatCan estimate will occur in the coming year, and, if average, that increase will result in a final production estimate for the 2022 season to be near 19 million tonnes,” Mulhollen wrote in an email.

He further explained such changes in StatCan’s canola estimates have occurred before and difference between the agencies is not unusual.

“In November 2020, StatCan reported 18.7 million tonnes of canola produced, and then revised that estimate for the 2020 crop to 19.5 million tonnes in August 2021, an 800,000-metric ton increase. The increase for the 2021 crop went from 12.6 million metric tons in November 2021, to 13.8 million metric tons in August 2022 (plus 1.2 million metric tons).

“This pattern of revising the estimate upward for canola, from the November of the reporting year to the subsequent July/August has occurred for nine of the last 11 seasons since 2011, and the increase averages approximately plus 700,000 metric tons,” Mulhollen said.

StatCan, he added, provides some of the most accurate agricultural production estimates in the world and the agency employs state-of-the-art modelling techniques for its summer reports. That modelling, he said, is very similar to that used by the USDA.

A spokesperson for StatCan said the agency cannot say at this time if it will revise its current estimates for 2022 as the New Year progresses.

“The decision to revise area, yield and production estimates is based on the results of internal supply and disposition exercises done while compiling estimates for stocks of principal field crops as of the end of December, March, and July,” StatCan media relations officer Maryse Carriere said.

“We continue to rely on this method to make revisions, when necessary, within the allotted two-year window from the date of release, based on the quantitative data available at the time.”

She also defended the agency’s use of its model with satellite imagery for its summer reports while keeping to farmer surveys for its late fall update. The differing methods has been a sore point among a number of traders and analysts.

“While the estimates released in July and August are currently model based, in the past Statistics Canada conducted surveys to produce these estimates,” she said. “Before deciding to move to a model-based approach, studies were conducted to determine how well the July and August survey results compared to those from the model. The analysis showed that they are quite comparable.”

Carriere noted the November report, released in early December, is based on surveys near the end of the combining season, which is to provide a more accurate picture of yields. Also, she said, more farmers are surveyed for the November report than what StatCan used to survey for the July and August reports.

— Glen Hallick reports for MarketsFarm from Winnipeg.