CNS Canada — Bid levels for Canadian mustard are dropping, according to an industry expert who says many producers grew crops without a contract.
“Half the acres in Saskatchewan would have been put into the ground without a contract,” said Walter Dyck of Olds Products at Lethbridge, Alta.
Right now, Dyck said, many producers are looking for prices but unfortunately aren’t seeing much response from companies who aren’t currently in a position to take in non-contract supplies.
Most have a responsibility to bring in their contracted seed first, he said.
“So sometimes rather than say we’re full or don’t have room, or our transportation lines are full, they drop the bid levels,” said Dyck, adding that’s one option companies have to decrease what they need to move in the short term.
In March, prices were 36 cents per pound for yellow mustard, he said. Later on during the summer, bids moved up to 37 to 38 cents/lb. before dropping back to the current price level of 33 cents.
Bids are currently sitting around 30 to 31 cents/lb. for brown mustard.
“They were higher during the summer but bid levels have come off over the harvest,” he said.
As far as yields go, Dyck said the weather has made an impact.
“We had some hail in early August and in early September,” he said, adding the full extent of the damage won’t be known until the harvest is done.
Market demand is still healthy, with the U.S. expected to take in roughly 60,000 tonnes this year and Europe 35,000 tonnes.
“I think the big increase is in the acres. A year earlier we were looking at 350,000 acres; now we`re looking at 100,000 more,” said Dyck.
Just 60 to 70 per cent of this year’s crop is currently in the bin, he estimated.
However, recent warm weather will help fields that had a late start due to the wet spring, said Dyck.
— Dave Sims writes for Commodity News Service Canada, a Winnipeg company specializing in grain and commodity market reporting.