StatsCan’s stocks report in line with expectations

(Resource News International) — Statistics Canada’s grain and oilseed stocks in all positions report for the period ended Dec. 31 was generally in line with pre-report expectations and helped confirm the production numbers the agency released in the fall, according to industry participants.

The numbers, released Friday, were not expected to have any kind of lasting impact on the market, they said.

“I would call the numbers market neutral at this point,” said Mike Jubinville, an analyst with ProFarmer Canada in Winnipeg.

There was nothing out of the ordinary based on the initial glances at the report, he said, adding that the federal statistics agency essentially confirmed the production numbers for the crops that were made in the fall.

There was also nothing out of the ordinary in terms of the domestic usage of the various crops, said Ron Frost, a Calgary-based analyst with Agri-Trend Marketing and Frost Forecasting Corp.

StatsCan pegged canola stocks in commercial position and on farm as of Dec. 31, 2009 at 8.762 million tonnes. This compared with pre-report ideas that ranged from 8.1 million to 8.7 million but was down from the year-ago level of 9.151 million tonnes.

Frost said the export and domestic crush sectors have done a nice job on using up some of the canola that’s available and if this pace can continue for the remainder of the year, the 2009-10 carryover of the commodity should not be burdensome.

Jubinville felt that the on-farm supply of canola was on the large side, but agreed that as long as demand remains constant the ending stocks outlook for the crop may not be as large as first feared.

Jerry Klassen, a grain trader in Winnipeg, said the numbers confirmed that while canola was harvested late, it did not appear to have caused any problem.

Wheat expectations

All-wheat supplies on farm and in commercial position were pegged by StatsCan at 21.685 million tonnes. Pre-report expectations had called for all wheat stocks to be in the 19.4 million- to 22.5 million-tonne range. All wheat supplies at the same time a year ago totalled 22.024 million tonnes.

Jubinville felt the all-wheat estimate was mostly in line with what the market had anticipated, but was a bit larger than what he was expecting.

“To me, either StatsCan has understated Canada’s wheat output or my estimate of increased feed usage of the crop has not been taken into account yet,” he said.

Frost also felt the all-wheat estimate was in line with pre-report ideas, but agreed the number was also a bit bigger than he was anticipating.

StatsCan pegged oat stocks on-farm and in commercial position at 2.838 million tonnes. At the same time a year ago, oat stocks totalled 3.402 million tonnes.

Frost felt the oat stocks number could have been a bit higher as more of the crop was said to have been harvested after the government agency’s fall survey. However, he also cautioned that while oat production in Canada may have been higher, there were concerns about winter storage of the crop.

“Yes, the oat crop was harvested, but it was brought in at a high moisture content,” he said. “As a result, the amount of spoilage in oats may be greater than normal, thus reducing the usable supply base.”

Barley stocks in Canada were estimated by StatsCan at 7.553 million tonnes. Pre-report estimates ranged from 7.85 million to 8.41 million tonnes, while at the same time a year ago, supplies were 8.5 million.

Of all the numbers the barley projection was considered to be a bit on the low side.

“Either the barley stocks number will be adjusted higher in future reports or there really is less supply of barley out there than had been anticipated,” said Keith Ferley of RBC Dominion Securities Inc. in Winnipeg.

Even if the barley supply is on the low side, he said, there will be likely little impact to the marketplace, as there are still plenty of alternative feeds available to work with.

Some of the huge durum stocks in Canada were seen supplementing the feed channels, he said.

Jubinville agreed that while the quality of Canada’s durum crop is pretty high, producers are looking ahead and not seeing a lot of delivery opportunities.

“As a result, in order to generate some cash flow from their durum stocks, they have been moving some of those stocks into the domestic feed market,” he said.

Jubinville, meanwhile, felt the barley on-farm supply was about 500,000 tonnes higher than he had anticipated.