Canaryseed prices could firm in 2017, says analyst

Depending on who you believe, canaryseed prices could either see a modest increase in 2017 or a modest decrease.

Either way, it could be a long time before growers see a return to the glorious days of 40 cent per pound canaryseed.

“We’ve had a situation where we’ve had fairly stable supplies and fairly steady demand, so we’re kind of in a market that’s been quiet and prices have been going sideways,” said Chuck Penner, a market analyst with LeftField Commodity Research.

“I think in the next year, we could see a little bit of a dip in acreage … along with a little bit better demand, so I think we could see a little bit firmer prices.”

Penner, who spoke at the Canaryseed Development Commission of Saskatchewan’s annual general meeting, said it’s unlikely that growers will see a huge bump in canaryseed prices any time soon.

He said prices in the 25 cent per lb. range are possible, but anything beyond that is probably not in the cards. Canadian canaryseed supplies are keeping markets in check.

Current bids have been consistently in the 21 to 22 cent per lb. range.

Penner said he expects Canadian production to drop slightly this year, based on slightly lower acreage, but some growers who attended the meeting were not so sure.

Prairie farmers planted 265,000 acres of the crop last year and they had exceptional yields, at least on fields that were harvested.

By some estimates, 10 to 15 percent of the 2016 crop —25,000 to 40,000 acres — wasn’t harvested last fall.

Canaryseed winters well and can be harvested the following spring with small yield losses.

It means Canadian growers could harvest another 20,000 tonnes in the spring, adding to already adequate supplies.

David Nobbs, a canaryseed grower and trader, said canaryseed stocks need to be drawn down before there is any hope of a rally.

He suggested that prices are more likely to dip below the 20 cent per lb. mark before they show any signs of strengthening.

Nobbs said Canadian production of 180,000 tonnes last year and carry-over stocks of 50,000 tonnes have pushed supplies to the 230,000 tonne range.

Canadian exports are projected to be in the range of 150,000 tonnes.

Canadian exports could also be affected by Argentine production.

Producers in Argentina are expected to produce 45,000 tonnes based on average yields and increased plantings.

That could provide additional competition for Canadian product, particularly in South America.

Unlike Penner, Nobbs suggested that Canada’s canaryseed acreage could increase this year, despite already burdensome supplies.

“My view is that acreage will go up this year, not down,” he said, noting durum acres might go into canaryseed.

“A lot of people who had record canaryseed yields last year also had commercial salvage durum that they’re trying to dump into feed markets for $2 or $3 a bushel.

“Unfortunately, I don’t think it will take much to push the market below 20 cents…. In the demand environment that we’re in, it’s not going to take a lot of extra product.”

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