StatsCan seen confirming tighter stocks Friday

Statistics Canada is expected to confirm tightening supplies of most grains and oilseeds, aside from wheat, in the agency’s latest stocks in all positions report, to be released Friday.

The report is to show the stocks being held on-farm and in commercial positions as of March 31.

“From a general assessment, we should have tighter figures on most commodities, but there is a little concern on what we’ll end up with on wheat,” Calgary market analyst Ron Frost said, noting wheat movement, aside from durum, was relatively slow over the winter months.

Canadian wheat stocks are generally expected to be up to two million tonnes lower at March 31 then they were at the same point the previous year, with most of the decline in durum.

“I think this could be an eye-opener for the tight durum stocks in Western Canada,” said Jerry Klassen, manager of GAP Grains and Products in Winnipeg.

A combination of a large export program and increased livestock feeding of low-quality durum was behind the tightening durum stocks, he said.

For barley, higher feed wheat prices and a lack of U.S. dried distillers grains with solubles (DDGS) moving into Canada led to more barley being fed in Western Canada over the winter, said Klassen.

The increased consumption should cut into those stocks compared to the previous year, he added.

Many crops, including barley, flax, oats, and canola had smaller production to begin with in 2010, Frost said.

Overstated

Darren Frank, an analyst at Oakville, Man. with FarmLink Marketing Solutions, said he would be watching the StatsCan stocks numbers to provide a better picture of production in 2010.

He thought acres and production were overstated for canola in previous StatsCan reports and expected a tighter stocks number in March could compensate for the larger numbers released earlier.

“I think we’ll see very tight (canola) stocks,” said Chuck Penner of Left Field Commodity Research in Winnipeg, noting that both exports and the domestic crush are running at a record pace.

Klassen expected the canola stocks number would confirm the tight fundamentals that the trade has already factored into the market for the most part.

Flax and oats stocks should also be down from where they were a year ago, he said, noting both crops will need more acres in the upcoming crop year to help alleviate that tightness.

Peas are also expected to see tight supplies in the StatsCan report. Penner and Frank both pointed to a large pea export program over the past year which cut into supplies.

The following are preliminary estimates for some of the crops that will be included in the Statistics Canada grain and oilseed stocks in all positions report scheduled for release on May 6. Figures are in millions of tonnes.

Total stocks, Total stocks,
March 31, 2011 March 31, 2010
(estimate) (actual)
All wheat 14.900-15.700 17.104
  Durum 2.700-3.000 4.763
Canola 5.000-5.200 6.283
Barley 3.500-4.000 5.096
Flaxseed 0.350-0.400 0.596
Oats 1.300-1.700 2.066

About the author

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Phil Franz-Warkentin writes for MarketsFarm specializing in grain and commodity market reporting.

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