The United States sometimes seems to be as much a foe as a friend when it comes to the Canadian grain industry, what with ongoing trade disputes and subsidy wars.
But it’s hard to imagine where Canadian grain and oilseed producers would be without the large and lucrative market to the south.
Once again in 2007-08, the U.S. will be Canada’s top foreign buyer of grain and oilseeds.
In the first 10 months of the crop year to May 31, the U.S. had imported 4.1 million tonnes of grain and oilseeds from Canada, a million tonnes ahead of second-place Japan.
Read Also
Global pulse consumption to grow
Global per capita pulse consumption is expected to rise 23 per cent by 2034.
If that pace is maintained through the final two months of the crop year, the total could exceed 4.8 million tonnes. That would represent about 17 percent of projected total exports of 27.8 million tonnes.
Randy Strychar, a grain market analyst with OatInsight, said it’s no surprise that the U.S. is Canada’s top export market.
“Given such things as ocean freight rates, close proximity, similar infrastructure and economies, it’s not surprising at all,” he said.
“The Americans are generally easy to trade with, they pay their bills and it’s certainly cheaper to ship to the U.S.”
According to Canadian Grain Commission statistics, U.S. purchases to May 31 included 705,000 tonnes of wheat, 442,000 tonnes of durum, 1.6 million tonnes of oats, 562,000 tonnes of barley, 106,000 tonnes of flaxseed and 695,000 tonnes of canola.
This year’s exports to the U.S. will almost certainly top 2006-07, when 4.3 million tonnes were shipped south.
Strychar expects exports to the U.S. will continue to grow in line with population increases. While he said there have been trade disputes involving wheat, other commodities like oats, canola, flax and malting barley move with no problem.
“That because the U.S. needs those commodities and they don’t grow them in large numbers,” he said, adding he has no concerns about a single buyer having a 17 percent market share.
“If it ever got to something like 40 percent, that might be a concern, but that’s not going to happen. Twenty to 30 percent is no problem.”
Second-place Japan imported 3.1 million tonnes in the first 10 months, a pace that would produce a year-end total of 3.6 million tonnes. That would be about the same as last year’s 3.5 million tonnes.
Other top customers in the same period include: Saudi Arabia, which bought 1.3 million tonnes of feed barley; India 1.2 million tonnes of peas; Indonesia just under 1.2 million tonnes of wheat; and China 840,000 tonnes of barley and canola.
