WINNIPEG — Foreign demand has picked up for Canadian flax, supporting prices even as world competition increases, said a grain brokerage firm.
Old crop flax prices have increased slightly since harvest because farmers have been judicious in the amount they market, demand has picked up and quality issues have emerged.
“The Chinese market has picked up a little after working through some of their stocks. This has happened a little sooner than expected,” Nathan Bosch, a merchant at Rayglen Commodities, said via email.
Delivered elevator prices for flax sit at about $11.39 per bushel in Saskatchewan, $11.65 in Manitoba and $11.11 in Alberta, according to Prairie Ag Hotwire.
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Canada’s seeded flax area increased last year, but the yield wasn’t as good as producers had expected, which is also supporting Canadian prices, said Michael Popowich, co-owner of TA Foods Ltd.
“There’s lots of flax out there, but how much of it is actually better than feed grade, I’m not too sure.”
Statistics Canada pegged the flax crop at 942,000 tonnes, up from 873,000 tonnes in 2014. Total flax supply, including carry in, is 1.05 million tonnes, up a little from 975,000 in 2014-15
Popowich said market watchers were expecting the volume to pressure prices, but now the availability of quality flax is lower than expected.
“So there’s a lot of flax, but a lot of it hasn’t been as good,” Popowich said.
“That makes the prices go up on average, if the producers are looking for the food side.”
However, increased competition from other growing regions, such as Ukraine, is keeping a lid on Canadian flax prices.
Analysts from that region are forecasting record flax exports.
