MarketsFarm — Canadian farmers will likely grow less canola and more barley in 2019, though the jury is out on exact acreage numbers ahead of Statistics Canada’s seeded area estimates due out Wednesday.
Barley prices have hit “historic highs” thanks to inclement corn-growing weather in the United States, which has buoyed most feed grain prices.
The current barley market is a sort of trifecta for producers: prices are strong, seeding costs are relatively low, and slightly drier-than-average planting weather didn’t hinder crop emergence.
“That really encouraged acres,” said Jerry Klassen, manager of Canadian operations with Swiss-based GAP S.A. Grains and Products in Winnipeg.
Traders estimate barley acres to be between seven million and 7.5 million, which compares to acreage estimates in March of 7.155 million. Farmers grew 6.493 million acres of barley in 2018-19.
Most industry experts anticipate canola acreage to be lower than Statistics Canada estimated in April due to China’s ongoing block on Canadian canola. Large carryout volumes from the previous growing season may also weigh on acreage numbers.
“Farmers are very educated, they understand the situation and the market,” Klassen said. “They’ve had pretty good prices, but if they didn’t forward-sell then there’s a lot of nervousness about new crop.”
Though current canola prices are propped up due to widespread Prairie drought, rain in the forecast may cause the crop outlook to improve.
“With the rains we’re going to have, we’re going to have another burdensome carryout. We’re going to have to find a home for three to four million tonnes of canola,” said Klassen.
Market participants anticipate canola acres to be between 20 and 21 million, on par with Statistics Canada’s April estimate of 21.315 million, and lower than the 2018-19 acreage of 22.813 million.
Oat acreage is expected to be in line with Statistics Canada’s previous estimates, due in part to steady prices and agronomic decisions.
“Oats are a regular part of the rotation for some producers, so you don’t see large swings each year,” said Klassen.
“We’ve seen pretty good prices over the years, so farmers are optimistic.”
Durum acreage, however, may see a drop from previous estimates thanks to lower-than-expected prices in recent years.
“Farmers have been discouraged with durum,” Klassen said. “They’ve had pretty good-quality crops in the past years, but they haven’t been receiving the price.”
— Marlo Glass writes for MarketsFarm, a Glacier FarmMedia division specializing in grain and commodity market analysis and reporting.
Table: Pre-report trade guesses ahead of Statistics Canada’s acreage estimates on June 26, 2019, in millions of acres.
|Canola||19.800 – 21.350||21.315||22.813|
|All wheat * .||25.000 – 26.000. .||25.675||24.735|
|Durum||4.200 – 5.900||5.021||6.185|
|Barley||7.000 – 7.500||7.155||6.493|
|Flaxseed||0.990 – 1.250||1.000||0.857|
|Oats||3.100 – 3.400||3.291||3.053|
|Lentils||3.200 – 3.600||3.405||3.768|
* – “All wheat” includes spring wheat, durum, and winter wheat remaining.