The soggy spring faced by farmers in southwestern Manitoba and southeastern Saskatchewan is playing only a minor role on the trading floor of the Winnipeg Commodity Exchange.
Last week, canola futures prices moved up slightly by $2.50 to $7.80 per tonne, partly on concerns about the wet weather.
It’s hard to know how many acres intended for canola won’t get planted, said analyst Nolita Clyde of Statcom Ltd.
Clyde said many people think 200,000 to 500,000 acres could be left unseeded.
“It has provided the new-crop prices with some support,” said Clyde.
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Good weather this week could lead to some shorter-season Polish canola going in the ground, which Clyde pointed out is lower yielding.
The production problems are of great concern to the local economy of the region, she said. But because world oilseed stocks are burdensome, and include ample supplies of canola, Clyde does not expect the production problems to strongly increase canola prices.
“It’s still a long-term bearish situation, no matter how you cut it, at the moment.”
Chris Beckman, oilseed analyst with Agriculture Canada, agreed.
The area hurt by wet weather is small compared to the total canola production area on the Prairies, said Beckman. Meanwhile, record world oilseed production is expected this year.
“We’re just a drop in the bucket,” said Beckman.
Futures prices of the soybean complex, traded on the Chicago Board of Trade, have been sliding the past few weeks, he said. Canola prices generally track soybean, oil and meal trends.
Beckman doesn’t foresee production problems having any major impact on canola prices in coming weeks.
“I think if (traders) were nervous, they would have been nervous by now.”
Clyde noted the Canadian dollar has been fluctuating higher lately, which tends to have a downward effect on canola prices.
North Dakota farmers have embraced canola as a cash crop in recent years. Many of them have also had trouble getting their crop in the ground because of wet weather. At the end of May, farmers there had planted 68 percent of their canola.
Clyde said she expects farmers in the state will still get close to one million acres of canola in the ground.
Before seeding delays, she had expected 1.2 million to 1.3 million acres of canola in the state.
