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Canola oil content disputed

There is some dispute about the oil content of this year’s canola crop.

The Canadian Grain Commission reports the mean content of No. 1 canola in Western Canada this year is 44.3 percent based on 1,798 samples.

That is almost identical to last year’s number of 44.2 percent.

However, based on an oil analysis of vessels loaded at Port Metro Vancouver, the oil content is down one percent compared to last year.

“We don’t understand as a trade why the oil content is so low out of Saskatchewan and Alberta this year,” said Glen Pownall, managing director of Peter Cremer Canada.

Oil content is determined during the pod fill stage of development, which occurs late in the summer.

“If you have hot conditions in August, typically you lose oil content but I don’t think we had poor conditions during that timeframe,” he said.

“So I’m a little bit baffled as to why we’re seeing such poor oil content in the seed.”

Cremer does not put much faith in the CGC estimate because it is based on a limited sample size. He believes what gets loaded onto a ship is a more accurate reflection of what Canada has to sell.

He said end users are going to have to “re-jig” their crush margin calculations to compensate for the poor oil content. It will likely result in a lower purchase price for the canola or a higher price for the oil.

“We already have very poor margins in China and if you take off one percent of oil, it makes it even worse,” said Cremer.

Patti Miller, president of the Canola Council of Canada, has not heard any concerns about poor oil content and neither have her contacts at the Canadian Grain Commission.

She said the CGC’s estimate of oil content could differ from a vessel analysis because the CGC measures oil content on the basis of perfectly clean canola. Canola loaded on the boats includes dockage.

Miller also noted that the CGC estimate is the average of samples taken from across the Prairies.

The canola loaded on a vessel could be drawn from one specific region that may have had lower oil content because of poor weather conditions in that area, she said.

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