Tight canaryseed supply may not meet demand

Despite issues with Canada’s largest canaryseed customer, the small supply of canaryseed this year may not be able to meet other world exports, an industry official reports.

“There’s a whole lot of stuff going on with different facets people are trying to sort out,” said Kevin Hursh, executive director of the Canaryseed Development Commission of Saskatchewan.

Mexico, which traditionally imports 25 per cent of Canadian canaryseed, remains out of the market due to restrictions on weed seed tolerences imposed in August.

Canadian exports to Mexico were brisk right until the changes, as concerned Mexican buyers snapped up canaryseed before the restrictions on quarantine weed seeds came to effect, said Hursh.

If the situation continues, with the new restrictions the export market would be still be very limited, he said. Even given other importing countries such as Belgium, Brazil, Spain and Colombia, more trade to other countries would not increase exports as world demand is constant, he said.

Even with a flat export market for canaryseed outside of Mexico, the biggest factor in the market is the very tight supply of the crop.

Even with the Mexican issues, current canaryseed projections may not be able to meet the export demand, he said. Recent Statistics Canada numbers point to estimated production of 77,100 tonnes, plus Aug. 1 beginning stocks of 39,000, leaving the total supply of canaryseed at 116,100 tonnes, far below the five-year export range from 152,000 to 204,000 tonnes.

While it is a low StatsCan estimate, Hursh said, it could be hard to question those numbers considering some areas, including the Regina and Moose Jaw area where flooding issues could have hurt the canaryseed crop.

StatsCan’s 2010 canaryseed crop production numbers were revised higher because the balance sheets did not work out, otherwise the numbers would have shown negative supplies, said Hursh.

While he questions the overall handling of last year’s canaryseed crop numbers, Hursh said it could be the fault of producers for not reporting the numbers, so they could push the crop price up.

While the overall crop of western Canadian canaryseed is projected to be down for this year and exports to Canada’s largest exporter are in limbo, Hursh said it is difficult to predict if farmers will grow more or less canaryseed.

Market price signals are the largest contributing factor, pointing to StatsCan supply and demand figures which should push the current price of 26 cents a pound upward.

If the signal is right, farmers are likely to grow more canaryseed, and if not they will grow less of the crop.

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