Canola exports’ record April pace seen slowing

(Resource News International) — Canada’s canola exports reached a record total of over 900,000 tonnes in April but that breakneck pace is not expected to continue through the end of the crop year, according to senior trade sources.

“If you include shipments from all of the ports, Canadian canola seed shipments reached roughly 913,000 tonnes in April, with 860,000 tonnes leaving off the West Coast alone,” said a senior trade source from a major Canadian agriculture company.

That compares to an average monthly shipment pace of 400,000 to 500,000 tonnes and the previous record in October 2008 at nearly 700,000 tonnes, he said.

While the source expects canola shipments to remain strong for the last three months of the 2008-09 crop year, the tonnage will likely slip “a tad,” he said.

“If you look at the vessel lineup out of Vancouver, there are seven boats already lined up for China but we probably won’t see that in June and July,” the source said.

The reason is partly that China begins to harvest its own rapeseed crop in May but also partly due to logistical constraints within Canada. Logistics through June and July are quite full and there is not a lot of capacity left after that, the source said.

“There are definitely cargoes on the books to China for that period but I don’t think that we’ll see as many. We might some more Mexican business and possibly something to Dubai because I don’t think there is anything lined up for Dubai in May,” the source said.

The canola carryout in Canada this year could be a lot smaller than people expected even last month, given the way exporters have been drawing down stocks, he added.

Lach Coburn, West Coast manager for Cargill Ltd., agreed another record month like April is unlikely.

“We’re still going to have a pretty good shipments in May, June and July, but it will be hard to hold that pace. To hold that pace, you would take the canola carryout pretty quickly,” Coburn said.

April’s record pace of over 900,000 tonnes deserves applaud, Coburn said. Logistically, things moved very well from a number of major Canadian ports due to less congestions from other commodities.

Also, “the canola yields (in Canada) last year were tremendous and it was great that the market was there to take it,” Coburn said.

In Agriculture and Agri-Food Canada’s April 30 supply/demand report, 2008-09 Canadian canola exports were forecast at seven million tonnes. That compares to 5.66 million tonnes of exports during the 2007-08 crop year and the 6.5 million tonnes forecast for 2009-10.

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