The farmers’ adage that good prices are the cure for good prices could prove true if Prairie canaryseed growers follow through on Statistics Canada’s reported intentions.
The Canaryseed Development Commission of Saskatchewan (CDCS) warned Monday that the federal statistics agency’s expectation of 510,000 canaryseed acres in 2010, combined with an average yield, “would produce more canaryseed than the market can consume.”
Prices now sitting around 15-17 cents a pound make canaryseed look like an attractive option, given the underwhelming price prospects for several other crops, the commission said.
Read Also
U.S. grains: Corn rebounds from contract lows on short covering, bargain buying
Bargain buying and short covering lifted U.S. corn futures on Monday after the market slid to contract lows on expectations for strong U.S. output, traders said.
Saskatchewan growers alone put 300,000 acres into canaryseed in 2009, the Saskatoon-based commission noted.
“Producers face difficult cropping choices as they attempt to maintain profitability, but the CDCS is cautioning producers that too many canaryseed acres may lead to disappointing price levels for an extended period of time,” the commission said.
The CDCS said it’s still working toward human food uses for the crop and is “excited by the medium- to long-term prospects.”
In the short term, though, the market for canaryseed remains “almost exclusively as birdseed” and worldwide demand is thus likely to remain relatively constant.
Saskatchewan is the world’s top producer and exporter of canaryseed, so price direction is largely determined by how much is produced in the province, the CDCS said.
In its upcoming newsletter, the CDCS noted, market analyst Greg Kostal will have a template showing canaryseed production at various acreage and yield assumptions, combined with a supply/demand analysis to estimate price levels.
