MarketsFarm — Statistics Canada’s first production estimates for the 2019-20 crop, released Wednesday, were generally in line with expectations, although upward revisions are likely in subsequent reports.
The agency’s production of principal field crops report was “bang on with expectations across the board,” according to Ken Ball of PI Financial in Winnipeg.
While both the canola and total wheat forecasts were at the lower end of market estimates and slightly supportive for prices, he said the Statistics Canada survey was conducted in July and didn’t reflect improved crop conditions in August.
Ball expected most crops would see upward revisions of three to five per cent in subsequent reports, with canola likely hitting 19 million tonnes and spring wheat 25.6 million.
StatsCan on Wednesday pegged the canola crop at 18.453 million tonnes, which would be down by nearly 10 per cent on the year and the smallest crop in five years.
All-wheat was estimated at 31.251 million tonnes (including durum, other spring wheat and winter wheat), a reduction of about one million tonnes from 2018-19.
However, the smaller wheat crop was tied to a drop in durum production, with other spring wheat up 1.2 million tonnes on the year at 25.108 million tonnes.
“I suspect the canola crop has improved,” said analyst Mike Jubinville of MarketsFarm Pro. However, he added, development is running behind normal and still needs good harvest conditions in northern growing regions to meet the expectations.
StatsCan on Wednesday estimated barley production at 9.645 million tonnes, up by about 1.3 million tonnes from the previous year. The larger crop was not a surprise, with new-crop bids already under pressure compared to the tight old–crop barley market, said Jubinville.
Peas at 4.528 million tonnes and lentils at 2.384 million tonnes respectively were up by 27 and 14 per cent respectively. Those large crops suggest that the pulse market “will be stuck in the doldrums” until a fix is found for demand issues with India, Jubinville said.
— Phil Franz-Warkentin writes for MarketsFarm, a Glacier FarmMedia division specializing in grain and commodity market analysis and reporting.
Table: Summary of Statistics Canada’s August production estimates for 2019-20, released Aug. 28, 2019. Pre-report estimates and year-ago numbers are included for comparison. Production in millions of metric tonnes. Source: Statistics Canada.
|trade estimates, .||August|
|Durum||4.530 – 5.350||4.420||5.745|
|All wheat. .||32.000 – 34.100||31.251||32.201|
|Oats||3.400 – 4.500||3.952||3.436|
|Barley||8.800 – 10.100||9.645||8.380|
|Flaxseed||0.500 – 0.570||0.558||0.492|
|Canola||18.000 – 20.500||18.453||20.343|
|Peas||3.600 – 4.550||4.528||3.581|
|Lentils||1.850 – 2.300||2.384||2.092|