Old crop prices called ‘astronomically high’ as COVID-19 isolation prompts more people to feed birds this summer
Prices for sunflowers, if a buyer can even find them, are in the stratosphere.
In most years, oilseed sunflowers sell for 20 to 25 cents per pound in Manitoba. Right now, some farmers are asking for 40 cents per lb.
“Pricing on old crop is astronomically high. I have not seen sunflowers selling for the prices they are selling (at) right now,” said Jody Locke, special crops manager with R-WayAg, a company in St. Claude, Man.
“Most guys are looking at that 35 to 40 cents (per lb.), if they’ve got them.”
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Old crop prices are extremely strong because sunflower stocks are almost non-existent.
Black oil sunflowers grown in Manitoba are mostly used to make bird seed, and the market for bird food has been on fire in 2020.
With more Canadians and Americans at home because of COVID-19, a horde of new customers are buying seed for the birds in their backyard.
“I’ve been in bird food for 11 years and this is probably the busiest year that I’ve ever seen. It (the pandemic) has created a new group of people who are feeding birds, who likely never did before,” said Locke, who joined R-WayAg last year.
“There’s a whole new generation … who are getting into the bird feed.”
R-WayAg, which sells feed, seed and fertilizer, started a bird food division last year.
“We’re sort of a wholesaler. We sell (bird food) to companies that sell to retailers,” Locke said.
Booming sales, especially in the spring, exhausted supplies of black oil sunflowers from the 2019 crop, in both Canada and the U.S.
Many players in the bird food market are waiting for the 2020 harvest so they can fill bins with black oil sunflowers and restock warehouses with bags of bird seed.
“The inventory that’s out there is so tight. We’re just trying to get through until new crop,” Locke said.
The surge in bird food sales is great news for Manitoba’s sunflower sector, which has gone through a down period since about 2015. From 2016-19, acres were around 50,000 to 65,000, which is much lower than historical norms in the province.
This year Manitoba farmers seeded about 90,000 acres, the highest level since 2015.
Growers are coming back to sunflowers or trying them for the first time because they can be highly profitable.
“We’re seeing our growers (are) achieving some yields that are starting to offer a really good return on investment,” said Darcelle Graham, chief operating officer of the Manitoba Crop Alliance, a new organization that represents producers of wheat, barley, corn, sunflowers and several other crops.
“Growers are getting better at it…. Our average yields are (now) around that 2,200 lb. (per acre) mark, which is a significant increase over what we used to see — around 1,800 in 2014-15.”
Better hybrids, some with herbicide tolerance, along with warm, dry summers, have combined to boost sunflower yields in the province.
Prices for new crop sunflowers, the black oil type, are in the “mid-$20s,” Locke said.
At 25 cents per lb., a 2,200 lb. yield would produce revenues of $550 per acre.
With such numbers, sunflowers are attracting more attention in Manitoba.
R-WayAg contracted production this year with a number of farmers who haven’t grown sunflowers for years and producers who tried them for the first time in 2020.
“I think producers are looking for new opportunities,” Locke said.
South of the border, farmers in North and South Dakota, the two major sunflower-producing states, seeded more than 1.1 million acres, an increase of nearly 200,000 acres over 2019.
Crop yields look promising in the U.S. and Canada, and a large crop will put downward pressure on prices.
“With the way the crop condition is … we’re definitely going to be above the five year average, the trend yield,” said John Sandbakken, U.S. National Sunflower Association executive director.
“The first numbers I’ve seen is the U.S. crop will be 25 percent higher than it was last year.”
However, with minimal stocks, buyers and bird food companies will be eager to buy up the 2020 crop, which should support prices.
Looking ahead, strong prices should encourage more acres, and sunflowers may become a hot crop in Manitoba over the next few years.
“All crops go through a cycle,” Graham said.
“I think we’ve gone through our downturn in sunflower acres. Hopefully, we’re seeing that acreage is going to increase.”
