Farmers are planning to pull back from wheat, stick with heavy canola acres and boost their durum, barley, oats, lentils, peas and flax acreage, says Agri-Trend founder Rob Saik.
However, Saik told the Grain World conference Feb. 23 that a lot could change before seeding, which usually isn’t the case.
“We’re far behind the last two years,” Saik said about his company’s farm acreage planning business.
“Farmers have not solidified all of their cropping plans for 2015.”
Louis Dreyfus Canada vice-president Brian Conn agreed that farmers haven’t settled their acreage yet.
“We’re seeing the same thing as well,” he said.
“A lot of growers appear to have not made a lot of decisions for this time of year.”
Most farmers have usually set their acreage by now.
That uncertainty muddies the outlook for prairie crops because their domestic supply and demand outlooks sometimes depend heavily on Canadian production, especially with special crops and flax.
Canada is a powerhouse exporter even with the bigger crops, which means uncertainty.
Agri-Trend is predicting that farmers will seed six percent fewer (non-durum) wheat acres, .5 percent more canola acres, 15 percent more durum, 22 percent more barley, seven percent more oats, 13 percent more flax and 13 percent more lentils.
Conn said Louis Dreyfus is predicting a 4.5 percent drop in canola acres to 19.4, which if combined with a trend yield of 35.8 should produce a 15.14 million tonne crop.
Agri-Trend’s acreage forecast differs from a recent forecast form Agriculture Canada, particularly for wheat and barley.
Agriculture Canada sees wheat (except durum) at 19.5 million acres, with winter wheat down 33 percent and spring wheat up four percent.
It sees barley area at 6.42 million acres, up only nine percent, and canola at 20.76 million acres, up two percent.
Agri-Trend’s forecasted drop in wheat acres is dramatic, especially considering the projected drop in summerfallow acres by 35 percent.
Bearish sentiment is discouraging many farmers from seeding extra acres to wheat, but that’s making one beleaguered competing commodity more optimistic.
“That should be really favourable for barley acres,” said Lorelle Selinger, the merchandising manager for Cargill Malt.
That could lead to a five percent rebound in malting barley acres, she said.
However, world supplies likely won’t give barley much bullish room to run, even with strong North American demand for quality barley following last year’s disappointing harvest.
“There are adequate supplies, so the overall global pricing should stay relatively flat,” said Selinger.
Lawrence Yakielashek, general manager of FarmLink Marketing, said he was much less bearish about wheat than most.
“We’re way too comfortable and we have outlying events that are brewing,” said Yakielashek, noting strong demand growth pulling at stocks.
In Canada, the outlook becomes much better as the wheat stockpile shrinks than the glutted situation that arose in 2013-14. The 2015-16 situation could be domestically bullish if stocks drop 28 percent by the end of 2014-15 to four million tonnes.
“We have a tight carryout,” he said.
Flax has been a winner for farmers this winter, said Chuck Penner of LeftField Commodity Research. However, they shouldn’t assume that will continue.
The high for flax tends to be near $15 per bushel, so near time prices might not last much longer. As well, new crop bids, which are still attractive, could slide if production seems adequate this year.
“I see some downside risk,” said Penner.