Biggar, Sask., farmer Rene de Moissac was annoyed, but not worried, by the Statistics Canada acreage report that showed a much bigger than expected mustard crop.
He thinks that even if a large prairie crop is produced, prices will be healthy.
“We have an empty pipeline right now, completely empty, and it’ll take a couple of years to get it full again,” said de Moissac.
Statistics Canada said in March that prairie farmers intended to plant 710,000 acres of mustard this spring. But recently the agency reported that actual acreage is expected to be 870,000.
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De Moissac didn’t sign any delivery contracts this spring when grain companies were offering 25 cents per pound. He knows a large crop might depress prices at harvest, but he’s willing to wait for a better market.
“I’m going to sell the bad crops near harvest just to get cash flow, but with mustard, I’ll put it in the bin and wait,” said de Moissac.
That optimism isn’t shared by Brett Meinert, a Swift Current producer who is also president of the Saskatchewan Mustard Growers Association.
He contracted some of his crop for 25 cents a lb. and doubts the rest will fetch that much.
“My guess is that the contract price is going to be the high price for the year,” said Meinert, who thinks a large crop will alleviate any buyer worries about supply.
“I see a lot of yellow fields out there.”
Mustard prices are volatile. Canada produces most of the world’s traded mustard, so changes in the amount of prairie production can cause wild swings in mustard prices.
For the past two crops, prices have surged high, topping out at 75 cents a lb. two years ago, which inspired this year’s huge acreage, said Stat Publishing analyst Brian Clancey.
An increase in mustard acres was expected, but the industry was shocked by its size.
“No one thought it would be up like that,” said Clancey. “People weren’t surprised it was up, but the degree, no one expected that.”
Climax, Sask., special crops marketer Mike Kirk said many farmers saw the 25 cents and jumped at a chance to lock in a good return.
“Guys planted as much as they could,” said Kirk.
Meinert said many canola growers planted mustard acres this spring because of mustard’s better price outlook at seeding time.
“For a few more dollars (in likely return), why not check it out,” said Meinert. “That’s what happened.”
If prices fall below 25 cents many farmers will be unhappy, but Meinert said it will help them over the long run.
High mustard prices have started to make farmers outside of Canada think of growing the crop.
“I can’t tell you how many calls I’ve had from around the world from people asking me how you grow this 75-cents-a-pound crop, and where can they get some seed,” said Meinert.
Farmers in North Dakota and Montana have also started considering the crop, and prairie farmers won’t be helped if the growing base expands.
It is also not good to push buyers too hard.
“These high prices are not good for our customers. Therefore they are not good for us. We need a reliable supply for reliable customers,” said Meinert.
