A premium price above canola should drive flax acreage up nine percent on the Prairies this spring compared to last year, says a market analyst.
If the price spread holds, flax acres could jump even higher.
“Back in December and early January, there was very little premium for flax over canola,” said Glenn Lennox, an oilseed analyst with Agriculture Canada in Winnipeg.
“(But) the flax prices have maintained their strength, whereas most other crops have gone down. So all of a sudden flax looks like the crop to grow.”
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Agriculture Canada is now predicting, based on its March 6 Grains and Oilseeds Outlook, that Canadian farmers will plant 1.69 million acres of flax this crop year, compared to 1.56 million acres in 2008.
As an example of the current price differential, Lennox referred to a Richardson Pioneer quote from last week for western Manitoba.
The price quote for new crop flax for October 2009 is $410 per tonne ($10.42 per bushel) at the elevator. Canola is quoted at $375 per tonne ($8.50 per bu.)
Given that premium, it’s logical for producers who do not mind growing flax to shift away from canola, Lennox said.
“At current prices, flax pencils in at one of the most profitable crops you can grow,” he said. “I wouldn’t be surprised to see the actual flaxseed acres significantly exceed (what) we’re currently forecasting.”
Producer Eric Fridfinnson plans on contributing to the increase in flax acreage by seeding 200 more acres this year.
“Last year we planted about 500 (acres) and this year I’d like to plant 700 (acres),” said Fridfinnson, who farms near Arborg, Man., and is chair of the Flax Council of Canada.
Aside from the price premium, Fridfinnson said lower production costs might also encourage more flax production in 2009.
“It is one of the crops that doesn’t have the high package of input costs going into it, so that’s helpful in a year like this,” he said.
Despite the likely gain in acres, Agriculture Canada predicts flax production of 850,000 tonnes in 2009, almost identical to 2008, because yield is expected to be lower than the extremely high levels last year.
Last year, the average flax yield on the Prairies was 22 bu. per acre.
“A lot of people we talked to would talk of record yields for flax on their farms,” said Allen Kuhlmann, chair of the Saskatchewan Flax Development Commission.
Kuhlmann, who farms near Rouleau, Sask., said he got 40 bu. per acre on his irrigated flax crop.
“That wasn’t unheard of. There were some plots in Manitoba that got in the mid-40s,” said Kuhlmann, who attributed the high yields to the flax crop getting off to a good start in 2008.
This year Agriculture Canada expects flax yields will return to more typical values in 2009, with estimated yields of 20 bu. per acre.
