Saskatchewan’s canaryseed commission is cautioning producers to think twice before seeding the crop this spring.
With prices of 15 to 17 cents a pound, canaryseed is an attractive option compared with wheat, durum, barley and field peas.
Statistics Canada has projected a 70 percent increase in acreage this year.
However, the commission warns too much canaryseed could send prices for the high-flying bird food back to earth.
“I don’t see how that number of acres can do anything but drive prices down, if the yields are where they’re supposed to be,” said Glenn Byrnes of Eston, vice-chair of the Canaryseed Development Commission of Saskatchewan.
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“There’s just not going to be an increase in demand at this stage to handle that volume.”
In its April 26 report of seeding intentions, Statistics Canada predicted that farmers will plant 510,000 acres of canaryseed.
That would represent a 70 percent increase from last year’s 300,000 acres.
It’s also well above market expectations, which had hovered around 370,000 to 400,000 acres.
In response to the Statistics Canada report, the canaryseed commission issued a statement saying such an acreage, combined with normal yields, would produce more seed than the market can consume.
“(The commission) is cautioning producers that too many canaryseed acres may lead to disappointing price levels for an extended period of time,” said the statement.
Saskatchewan is the world’s leading producer and exporter of canaryseed, so its crop has a significant impact on world prices.
Byrnes said canaryseed sales at his company, Agra Processing Co. of Eston, are running 10 to 20 percent ahead of last year.
He said last week’s rain could prompt some producers to reconsider their seeding plans.
“Producers should step back and take another look and see if they want that increase in acres given the possible impact on prices,” he said.
At the same time, he acknowledged it’s a difficult decision for an individual farmer to make when he doesn’t know what other producers are planning.
Agriculture Canada market analyst Sergio Novelli had projected 375,000 acres of canaryseed in his March 10 report, well below Statistics Canada’s 510,000 acres.
He said the big move to canaryseed reflects the fact the crop is a better choice than many alternatives.
“Farmers see it as a pretty decent price, it’s moving, there seems to be a stable market for it and carryout stocks don’t look bad,” he said. “Farmers will take that.”
Novelli said that in light of the new acreage projection, he will reduce his 2010-11 average price forecast by three to four percent to around 17 cents a lb.
