Statistics Canada’s canaryseed acreage estimates are becoming a joke, says a leading processor of the crop.
“This is the fourth year that I’ve felt it’s completely out of whack, and we never do the big (price) run people are waiting for,” said David Nobbs, general manager of Canpulse Foods.
Statistics Canada is forecasting 245,000 acres of the crop, up from last year’s 210,000 acres.
“The number is completely incorrect,” said Nobbs, who is also chair of the Canaryseed Development Commission of Saskatchewan.
He believes farmers will plant 400,000 acres, up from 325,000 acres last year.
“Every year we start the year thinking there’s not enough canaryseed to meet the needs of the market, and every year we seem to meet it,” said Nobbs.
Gene Lahey, a grower from Lacadena, Sask., thinks Statistics Canada is understating acreage but also that Nobbs might be overstating it.
“We’ve been in the heart of canary country for years and I don’t see the fields that I used to,” he said.
Lahey is planting 640 acres of the crop, which is what he seeded last year. He expects total Canadian plantings will be in the low-300,000 acre range.
“Dave always thinks there is quite a bit more, and there could be, I guess. It always seems to dwindle in,” said Lahey, vice-chair of the commission.
Agriculture Canada forecasts 3,000 tonnes of carryout in 2013-14. However, Nobbs believes growers will have 50,000 tonnes in their bins and processors another 20,000 tonnes.
That’s why prices are 21 cents a pound instead of 50 cents a lb., which is where they would be if carryout was that paltry.
Statistics Canada March 31 stocks report pegged canaryseed stocks at 39,000 tonnes, less than half the 85,000 tonnes at the same time last year. If correct, it indicates Nobbs’ year end stocks forecast would be high.
As for Statistics Canada’s spring planting survey procedure, Nobbs thinks it is either flawed or growers are attempting to manipulate the market.
“A lot of farmers like to see the number low, but the problem is it really doesn’t help the market at the end of the day,” he said.
Buyers rely on their own numbers, which are usually much higher than Statistics Canada’s.
Nobbs doesn’t expect the price rally that some analysts are forecasting.
Some processors are looking for tonnes, but growers have stopped selling. They appear to be waiting for a run on prices. Nobbs expects they will start selling in late June after spraying is done, which could temporarily depress prices.
Lahey believes Nobbs’ price outlook will prove fairly accurate.
“I hope it’s higher, but I think he’s probably pretty close,” he said.
Lahey can make money on canaryseed even at 21 cents per lb., as long as he gets average yields. It still pencils in better than most crops. He believes canaryseed prices will rise if durum goes up.
However, Nobbs said the crop tends to track corn prices more closely, and the outlook for corn isn’t promising.
The 2013-14 canaryseed shipping program has been better than the previous year despite winter railway congestion, a trucker strike at the Port of Vancouver and the recent difficulty sending product to Mexico, Canada’s top customer.
Canadian National Railway and Canadian Pacific Railway are focusing on west coast grain movement. They’re not interested in sending rail cars to Mexico because the turnaround time is too long and they have to meet government-imposed mandates for shipping grain.
Nobbs hopes the railway transportation mess has cleared up by summer because it is still a disaster from his vantage point in Kindersley, Sask., despite the government’s shipping mandate.
“It’s borderline hell. I don’t know what I did in a former life to deserve this,” he said.