- Location
- Stoneleigh
As markets are in the midst of being very reactive to weather, crop area data can also drive prices for the 2021/22 marketing year.
Yesterday, Statistics Canada released their estimated area of principal field crops. With Canada being a net exporter of cereals & oilseeds, data like this can have implications on global markets.
To put this into perspective every marketing year they export over 70% of wheat produced and around 50% of canola (OSR).
The supply of wheat and canola from Canada will have indirect impact on our domestic ex-farm values. Further to that, the UK relies on a proportion of Canadian wheat due to its high protein.
The area for canola is forecast to increase to 8.7Mha. An increase has been expected in Statistics Canada’s monthly outlooks, as tightening supplies combined with high prices have incentivised planting.
However, what is critical to note is that the area for canola is not as high as the trade expected of 9.1Mha. ICE canola futures Nov-21 contract hit a record high in yesterday’s trading session of CA$711.50/t.
The wheat area is expected to decrease to 9.5Mha. Despite this lower area for the next marketing year, exports are forecast to remain strong from Chinese demand.
They could be even stronger demand globally from both the EU for durum wheat and the US as Megan’s analysis explained yesterday.
Back into the weather cycle
The Canadian crop in large isn’t even in the ground and linking to the start of this article the weather will continue to drive the market.
Canada is set to start commencing their planting of spring wheat and canola in the next couple of months, and the lack of sufficient rain will continue to be monitored, as pockets of the prairies have been dry.
With nearly 95% of all wheat and canola grown in these three provinces, weather here is the watch point. The next significant month will be July when the canola starts to flower and will be very sensitive to moisture and temperature stresses.
Canadian canola area increases for 2021/22... but below expectations
Join the 3.5K people who subscribe to our Grain Market Daily publication here - https://ahdb.org.uk/keeping-in-touch
Yesterday, Statistics Canada released their estimated area of principal field crops. With Canada being a net exporter of cereals & oilseeds, data like this can have implications on global markets.
To put this into perspective every marketing year they export over 70% of wheat produced and around 50% of canola (OSR).
The supply of wheat and canola from Canada will have indirect impact on our domestic ex-farm values. Further to that, the UK relies on a proportion of Canadian wheat due to its high protein.
The area for canola is forecast to increase to 8.7Mha. An increase has been expected in Statistics Canada’s monthly outlooks, as tightening supplies combined with high prices have incentivised planting.
However, what is critical to note is that the area for canola is not as high as the trade expected of 9.1Mha. ICE canola futures Nov-21 contract hit a record high in yesterday’s trading session of CA$711.50/t.
The wheat area is expected to decrease to 9.5Mha. Despite this lower area for the next marketing year, exports are forecast to remain strong from Chinese demand.
They could be even stronger demand globally from both the EU for durum wheat and the US as Megan’s analysis explained yesterday.
Back into the weather cycle
The Canadian crop in large isn’t even in the ground and linking to the start of this article the weather will continue to drive the market.
Canada is set to start commencing their planting of spring wheat and canola in the next couple of months, and the lack of sufficient rain will continue to be monitored, as pockets of the prairies have been dry.
With nearly 95% of all wheat and canola grown in these three provinces, weather here is the watch point. The next significant month will be July when the canola starts to flower and will be very sensitive to moisture and temperature stresses.
Canadian canola area increases for 2021/22... but below expectations
Join the 3.5K people who subscribe to our Grain Market Daily publication here - https://ahdb.org.uk/keeping-in-touch
