WINNIPEG, Manitoba, April 24 (Reuters) – Canadian farmers intend to curb canola plantings this spring, Statistics Canada said on Thursday, surprising traders who expected a bigger area.
Statscan said farmers would also taper back wheat sowings as expected, after a backlog in railway shipments left ample supplies of most crops from last year’s harvest.
Statscan, using a late March farmer survey, estimated farmers would plant 24.766 million acres of all-wheat, down 4.8 percent from last year, but exceeding the average trade expectation of 24.4 million acres.
Canola plantings looked set to reach 19.801 million acres, easing 0.7 percent from last year, but falling well below the average trade guess of 21.1 million acres.
Read Also
Canola groups disappointed in Carney’s plan to help growers, biofuel
Two national canola organizations said they’re not pleased with the federal government’s announcement on helping canola growers and the biofuel industry. The Canola Council of Canada and the Canadian Canola Growers Association expressed their disappointment in a Sept. 5 news release.
Canadian farmers produced record volumes of wheat and canola last year, but much of the crop remains locked in farm bins after the abundant supplies and frigid winter overwhelmed the railways that move crops to port.
For that reason, stocks look to be ample well into summer, said Dave Reimann, market analyst at Cargill Ltd.
A slight dip in canola planting intentions was a surprise, with the market expecting farmers to sow the second biggest canola area on record.
“It is somewhat bullish (for canola) in the sense that it is well below average guesses and will result in a slightly tighter carry-out than the trade expected,” Reimann said, referring to supplies at the end of the crop marketing year July 31. “Having said that, with the massive carry-out expected from this year and assuming average yields on that crop, (stocks) will still be ample going forward.”
ICE Canada new-crop November canola futures extended gains after the report before settling back to a rise of 0.4 percent.
Spring wheat acres, which make up most of the all-wheat category, are expected to shrink 5.6 percent to 17.978 million acres, with cash bids from country elevators sharply lower than a year ago, said John Duvenaud, analyst with Wild Oats Grain Market Advisory.
“Guys are sitting out there with wheat and they can’t move it,” Duvenaud said on a conference call organized by Minneapolis Grain Exchange. “You can see how there would be reluctance to put more spring wheat in.”
Statscan also said oat plantings would edge up 0.6 percent to 3.188 million acres, in line with expectations.
Smaller sowings of durum wheat, barley and corn are expected, but farmers intend to boost soybean plantings 16.5 percent to 5.264 million acres, an all-time high, Statscan reported.
Spring planting in Western Canada, the country’s main growing region, usually gets under way in late April or early May.
Canada is usually the world’s second- or third-largest wheat exporter and the biggest shipper of canola, a cousin of rapeseed used largely to produce vegetable oil.
