Traders look to new crop following StatsCan stocks estimates

CNS Canada — Canadian canola stocks were relatively tight at the close of the 2016-17 crop year, which should be underpinning the market as the trade works to get a better handle on new-crop production.

In a report released Wednesday, Statistics Canada pegged Canadian canola supplies as of July 31 at 1.35 million tonnes, compared to 2.09 million at the same point the previous year.

“This confirms that canola is tight, and every bushel counts in 2017-18,” said market analyst Neil Townsend of FarmLink Marketing Solutions in Winnipeg.

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That new-crop production was recently estimated at 18.2 million tonnes by StatsCan, which compares with the revised 2016-17 crop of 19.6 million.

“The canola trade is focused on new crop and repopulating the commercial pipeline,” said analyst Mike Jubinville of ProFarmer Canada.

Harvest results indicate actual production will be up from that earlier estimate, given the timing of the production survey, but Townsend said the yield bounce was not likely as big for canola as for wheat.

StatsCan pegged all-wheat ending stocks at 6.87 million tonnes, at the high end of expectations and well above the 5.18 million tonnes carried over the previous year. Of that total, durum stocks were pegged at 1.86 million tonnes, up from 1.1 million in July 2016.

After disease pressures in 2016, Townsend said there were still questions on the quality of the wheat and durum carried into the new crop year. However, the quality is looking much better in 2017, which should create some blending opportunities.

Looking at pulses, lentil stocks came in well above trade estimates, at 405,000 tonnes. However, Jubinville said the Canadian supply will not be a major market driving factor, with the demand — or lack thereof — from India determining where prices go.

— Phil Franz-Warkentin writes for Commodity News Service Canada, a Winnipeg company specializing in grain and commodity market reporting. Follow him at @PhilFW on Twitter.

Table: A recap of Statistics Canada’s stocks report for the period ended July 31, 2017, in millions of metric tonnes.

Pre-reportTotal stocks,Total stocks,
estimatesJuly 31, 2017.    .July 31, 2016
Barley1.500 to 2.3002.1221.443
Canola1.000 to 2.0001.3482.091
Flaxseed0.100 to 0.2000.1910.277
Oats0.500 to 0.9000.6900.930
All wheat.     .5.000 to 7.0006.8655.178
Durum1.100 to 2.6001.8631.100
Lentils0.200 to 0.350.    .0.4050.073
Peas0.125 to 0.4000.3010.174

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