Wheat and durum values for the new crop year generally increased in the Canadian Wheat Board’s latest Pool Return Outlook, reflecting weather risks.
Corn is providing a strong price floor, and there is little indication that the tight supply-demand situation will significantly improve in the coming year, said the comments accompanying the April PRO.
Delayed seeding in Canada and the United States is supporting wheat prices, as is the drought in the southern plains.
The board said there is no compelling evidence that a late crop results in reduced yield. The amount of unseeded acres has a greater impact, and that remains to be seen.
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There are dryness concerns in Western Europe, but only a prolonged period of hot, dry weather would significantly hurt yields.
Dryness has damaged China’s crop but most of the acreage is under irrigation.
Crop conditions are above average elsewhere.
India and Pakistan might produce record wheat crops, and India will likely export one to two million tonnes.
Durum growing conditions are favourable across North Africa and the EU, the board said.
The U.S. loan rate was announced in April and is not sufficient to encourage durum planting.
Statistics Canada estimated farmers’ seeding intentions at just above five million acres, but market factors and weather conditions will probably reduce that estimate, the CWB said.
Durum stocks are forecast to tighten in the U.S. and Canada.
Tight global supplies of malting barley will put Canada’s new crop in high demand from domestic and international maltsters.
Strong corn prices will support feed barley. Black Sea region barley will likely become available again.
An increasing number of cattle on feed should provide good Canadian feed barley demand, the board said. As well, less feed wheat will be available to compete with feed barley if the weather co-operates.
