Canada, United States seed more than expected
So much for last winter’s predictions by some farm-aid lobbyists that a lot of land would go unseeded this spring.
The argument was that cash-strapped farmers wouldn’t have the money to buy seed, fertilizer and chemicals.
In fact, according to Statistics Canada, farmers have dropped summerfallow to the lowest level ever.
StatsCan says there are a paltry 11.59 million prairie acres in summerfallow this year, down 16 percent from the March seeding intentions report and down almost 23 percent from last year’s actual number.
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In the 1980s, the Prairies regularly had 20-23 million acres in summerfallow. That number has been steadily dropping as farmers expanded their cropping rotations and implemented moisture-saving reduced tillage management.
But the standout plunge in unseeded land this year is probably indicative of a simple strategy – make up for low prices by increasing production.
Good land will not go unseeded. Some farmers can make money at today’s prices and they will buy or rent from those who can’t.
The StatsCan report, coupled with the United States Department of Agriculture seeded acreage report also out last week, will probably have markets in a funk for the next few weeks.
It seems there are more acres of everything than expected and the weather keeps improving.
Last week’s news pushed down even wheat prices, which had been more stable than feed grains or oilseeds because of a tightening global supply-demand balance.
But wheat might get a boost in the next USDA crop production report July 12 that estimates yields and total production.
Watch for lower winter wheat yields, test weights and protein.
The production problems in the southern U.S. and drought in Eastern Europe and China prompted the International Grains Council last week to drop its world wheat production estimate by a whopping 10 million tonnes from its May outlook.
It now estimates wheat production at 577 million tonnes and the carryover into 2001-2002 at 103 million tonnes, down from 105 million in its May forecast and 121 million last year.
Another point in the StatsCan numbers that we will cover in detail next week is the phenomenal increase in pulse crop acreage.
At 3.1 million acres, one million more than last year, StatsCan is forecasting a record crop of dry peas.
Lentil area was estimated at 1.8 million acres and chickpeas at 750,000, double the amount of last year.
