Unharvested crop muddles stocks report

Misleading information contained in Statistics Canada’s latest grain stocks report caused some head-scratching in the industry recently.

John De Pape, president of Farmers Advanced Risk Management Co., thought the Dec. 31 canola stocks estimate of 14.3 million tonnes seemed about right.

But then he read the second paragraph of StatsCan’s Feb. 5 stocks report.

“Because of poor weather conditions during harvest, a substantial amount of crops likely remained unharvested at the time of the survey,” stated the report.

“Farmers were asked to include only crops harvested and currently in storage when reporting stocks of principal field crops. Crops harvested after the collection period for the December survey will be included in later surveys.”

Suddenly the 14.3 million tonne estimate seemed way too high considering it didn’t include any unharvested production.

The Canola Council of Canada estimates two million acres of the oilseed went unharvested last fall. Using Agriculture Canada’s average yield estimate for 2019-20 results in 1.8 million tonnes of canola sitting under a blanket of snow.

De Pape said that just seemed like far too much canola on hand to start the new year.

It turns out he was right.

John Seay, head of StatsCan’s crop reporting unit, said the second paragraph of the stocks report was poorly worded.

“I can see where the confusion comes from,” he said. “Just to clarify, the current stocks number does include the unharvested area.”

Seay said it is true farmers are only asked for what is sitting in their bins when surveyed for the stocks report.

But that number is “rebalanced” based on other factors, including Statistics Canada’s November production estimate. That number includes what farmers had harvested as of November and what they expected to harvest later that fall/winter or in spring 2020.

The second paragraph in the stocks report was meant as a caveat that both the production number and stocks number are subject to change because farmers were merely guessing how much production was sitting in their fields when they were surveyed in November.

“If they were overly conservative with their estimates when they provided those in November, it’s possible that they could potentially end up harvesting more than they had estimated previously,” said Seay.

“As a result, both production and stocks could go up.”

De Pape said there needs to be more clarity in a number of statistical reports because the data is at times perplexing.

For instance, the Canadian Grain Commission recently corrected some of the data contained in its Grain Statistics Weekly report. The canola domestic disappearance number was overstated by 339,100 tonnes due to some licensee reporting errors.

The error has been fixed but there is still lingering confusion about how domestic disappearance is calculated.

De Pape also finds it puzzling that Statistics Canada reports there were 1.9 million tonnes of canola in commercial stocks as of Dec. 31 but the CGC says there were 1.38 million tonnes in commercial stocks at around the same time.

Seay said the difference is that Statistics Canada’s number includes canola in transit and in condo storage.

De Pape said that is news to him.

“I just don’t understand the building blocks the way I thought I did,” he said.

For example, the condo storage part of the explanation raises more questions about the stocks report because it suggests condo storage is considered to be commercial stocks, he said.

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