CNS Canada — Just how much barley did Canadian cattle eat over the past winter? Will there be any old-crop wheat left over this year? And how much canola was really grown in 2015? Answers to these questions and more will be closer to being found when Statistics Canada releases its latest stocks data on Friday.
The Stocks of Principal Field Crops report will show supplies of Canada’s major grains, oilseeds and pulses held on-farm and in commercial facilities as of March 31, 2016.
The March stocks report doesn’t typically contain any major market-moving surprises, but the data will still be followed by analysts and industry participants looking to fine-tune their own supply/demand projections.
Canola has seen strong exports and domestic crusher demand this year, which should see stocks come in below the 8.328 million tonnes seen at the same point the previous year, according to market participants. While smaller canola stocks are generally expected, just how much smaller remains to be seen.
If canola stocks are deemed tight, it will place more focus on new-crop production prospects and lend underlying support to prices, said Jerry Klassen, manager of the Canadian office for Swiss-based GAP SA Grains and Products in Winnipeg.
The StatsCan stocks numbers may also shed some light on the size of the 2015 canola crop. “There is a lingering view that last year’s production, or carry-in from the previous year, is bigger than what’s being suggested by StatsCan so far,” said analyst Mike Jubinville of ProFarmer Canada.
Jubinville pointed to the feed, waste and dockage number currently being used for 2014-15 by Agriculture and Agri-Food Canada, nearly 600,000 tonnes, as being “out of line with history.”
An adjustment will eventually be made, but won’t change the big picture of the canola market, he said.
Looking at the grains, “we’ve had more cattle on feed throughout the winter and heavier carcass weights, so I think we’ll see lower barley stocks,” said Klassen.
Feed wheat was also trading at a substantial premium over barley throughout the winter, which saw less wheat and more barley in cattle rations, he said.
At the same time, “we’ve had a surge in the (wheat) export program,” he said, and the trade will be watching just how much wheat went into feed channels, as wheat stocks are moving to historic lows.
Agriculture and Agri-Food Canada currently forecasts all-wheat ending stocks for 2015-16 at only four million tonnes, which Jubinville described as “de facto zero.”
The strong wheat export pace is well known, he added, and the stocks report should help confirm the tightening supply situation.
“We’re looking to see how much is used as feed, because (wheat) stocks will drop to historical lows by the end of the crop year,” Klassen said.
Canadian wheat stocks on March 31, 2015 came in at 18.102 million tonnes, according to StatsCan data. Average trade guesses heading into Friday’s report anticipate supplies at the same point this year will be down by at least three million to as much as five million tonnes.
— Phil Franz-Warkentin writes for Commodity News Service Canada, a Winnipeg company specializing in grain and commodity market reporting. Follow CNS Canada at @CNSCanada on Twitter.