Winnipeg | Reuters — Canadian farmers produced the smallest canola crop in five years, but the largest wheat output since 2013, Statistics Canada said in its final harvest estimate of the year.
Canola production looked set to reach 18.7 million tonnes, down 4.5 per cent from last year and below trade expectations.
It was a drop of nearly 700,000 tonnes from StatsCan’s previous estimate in September. The government agency cited dry conditions on the Canadian Prairies late in the growing season, which reduced yields.
Canola futures have registered seven-year highs in recent weeks, part of a global oilseed rally that reflects concerns about South American soybean crops and brisk Chinese buying.
ICE Canada January canola futures extended their gains after the report, climbing 1.4 per cent.
“This is really a demand-driven rally, but this (estimate) is just fueling the fire,” said Dave Reimann, analyst at Cargill’s MarketSense.
Canada is the biggest global producer and exporter of canola, a cousin of rapeseed used largely to produce vegetable oil.
StatsCan pegged the all-wheat harvest at 35.2 million tonnes, the biggest crop in seven years and larger than traders and analysts expected.
Production of durum, used to make pasta, was the largest in four years, while spring wheat output was down slightly from 2019, but still the second biggest harvest in seven years.
StatsCan’s estimates are based on a farmer survey.
— Reporting for Reuters by Rod Nickel in Winnipeg and David Ljunggren and Dale Smith in Ottawa.