As two analysts looked at Statistics Canada’s latest report on total stocks of principal field crops, they immediately zeroed in on canola.
Statistics Canada’s report, released Tuesday, shows canola stocks as of Dec. 31, 2018 were at 14.553 million tonnes, up 4.9 per cent from year-earlier levels,
“The numbers are sort of in line with what you would expect with the production we had last year and export performance to date,” said Bruce Burnett of MarketsFarm, noting exports and domestic use are down.
Also, Burnett pointed out there was a carry-in of approximately one million tonnes more of canola from 2017, while 2018 production was down by 600,000-700,000 tonnes.
A large carry-out of about three million tonnes of canola was predicted by Mike Jubinville of ProFarmer Canada and MarketsFarm, as the demand for the crop is not strong enough.
“Relative to where we were last year, 13.869 million tonnes, there’s been a lot of analysts and organizations suggesting the canola carry-out is going to drop this year,” Jubinville said. “This is not telling me that.
“We’re going to need some pretty impressive export numbers to chew this inventory down to bring us to a carry-out similar to last year of about 2.5 million tonnes.”
Agriculture and Agri-Food Canada currently forecasts ending stocks for the 2018-19 crop year at 2.3 million tonnes.
As for wheat, Burnett said the numbers are down when durum was excluded, with a decrease of 3.5 per cent to 17.905 million tonnes. He credited that to a decline in production of spring wheat. Durum by itself was up 12.5 per cent from last year, at 5.328 million tonnes.
Jubinville saw a reason for concern with oats, for which stocks were down 19.7 per cent at 2.316 million tonnes.
“A smaller crop overall, because of the challenging harvest we had with cold, wet weather,” he said, suggesting oats be rationed to maintain higher prices until the 2019 crop is available.
Burnett cautioned as to how much one should read into this specific Statistics Canada report overall.
“In the pantheon of reports, it doesn’t really give you a lot. You’re too close to harvest to show anything in terms of what the usage trends are.”
Crops covered in the Statistics Canada report also include barley, of which stocks fell 18.2 per cent to 4.938 million tonnes, and soybeans, with stocks down by 8.5 per cent to 3.994 million tonnes.
Flax dropped 31.7 per cent, for stocks of 356,000 tonnes; rye plummeted 58.5 per cent, for stocks of 139,000 tonnes.
— Glen Hallick writes for MarketsFarm, a Glacier FarmMedia division specializing in grain and commodity market analysis and reporting.