The Canadian Wheat Board expects to export eight per cent less grain in 2007-08, but aims to sell high before the new crop arrives.
The board on Wednesday released its annual Grain Marketing Report, outlining its plans to sell aggressively at current high prices. In the report, CWB chief operating office Ward Weisensel urged Prairie wheat growers to commit their remaining wheat tonnage to Series B before the sign-up deadline, Jan. 31, as “future acceptance will be determined based on prices and sales opportunities.”
Under the CWB’s current projections, a Saskatchewan farmer can get about $268 per tonne for top-quality 2007-08 spring wheat (up 77 per cent over last year); $417 per tonne for durum (up 144 per cent) and $223 for malting barley (up 59 per cent over 2006-07 levels). A new pool return outlook (PRO) will be released Jan. 24.
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The CWB said its 2007-08 export target is for 10.9 million tonnes of wheat, 3.1 million tonnes of durum and three million tonnes of barley. Of that, 51 per cent was exported by Dec. 31, with 90 per cent expected to be exported by the end of May this year.
“Given this situation, we will need to have consistent delivery through the winter months and into spring,” Weisensel wrote.
Western Canada produced a smaller-than-average wheat crop in 2007, the board noted, as wheat-seeded acres dropped to a 30-year low due to a wet spring forcing many growers to seed shorter-season crops. Due to a cool, wet harvest after a hot, dry July, the overall harvest was also lower in quality than in 2006, but still above-average.
Thus, the board noted, its total 2007-08 export target is 1.5 million tonnes below last year’s exports, but near its five-year average of 17.7 million tonnes.
The crop year began Aug. 1 with what the board called the tightest stocks in 25 years, driving prices to record levels, still supported by demand.
However, because wheat trades in U.S. dollars, the strong Canadian dollar has “tempered” returns. Farmers would have seen about $135 per tonne more (in store Vancouver or St. Lawrence) in returns on wheat if the loonie was still trading at 2002-03 values, the board noted.
