It is early yet, considering most Canadian farmers have yet to turn a wheel, but it might be a year when North American grain production booms while Europe and Ukraine struggle.
That could mean downward pressure on crop prices generally, but Canada might have little competition in the canola export market and will have opportunities for durum and wheat sales in the Mediterranean region.
The U.S. hard red winter wheat crop has seen a complete turnaround from when it was seeded last fall and drought was a serious concern in the southern U.S. plains.
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Crop condition ratings now are much better than last spring.
Spring seeding in the United States is rushing ahead faster than usual, and moisture levels are generally good with more rain expected this week.
In Canada, a few western farmers have started seeding in much better conditions than last year. Without the problem of flooded fields, about six million acres will return to production. Statistics Canada will release results of its farmer survey on planting intentions April 24. Everyone expects a record number of canola acres.
The western Prairies entered spring dry. Recent snow and rain improved the situation in wide areas, but some places like southern Alberta and parts of the Peace could use more rain.
So overall, things look good in Canada and the U.S., but forecasters in the European Union are already cutting their outlooks.
Winter frost caused more damage than expected. Also, it is dry in parts of Britain, France, Spain and across the Mediterranean in Morocco.
Last week, French analyst Strategie Grains cut its forecast for EU soft wheat production by 4.3 million tonnes to 126.8 million tonnes. That is a bit smaller than last year’s 129.1 million tonnes.
The group cut the outlook for barley by 1.1 million tonnes to 52.4 million, still up one percent on last year.
It cut its durum forecast by 600,000 tonnes to 7.8 million, down six percent from last year.
Several million acres of winter crops will be plowed up and reseeded with spring corn and barley.
Oilseed analyst Oil World last week estimated the EU canola crop at 18.5 million tonnes, down 600,000 tonnes from last year’s disappointing harvest. However, recent rain has for now stopped the crop deterioration in Western Europe, and some analysts say it is too early to cut production forecasts.
Ukraine also suffered frost damage to its winter crop, and a lot of acres will be reseeded to corn and barley. While the wheat harvest is down, the country has a lot of carryover stocks that should allow it to maintain a good export pace in 2012-13.
Russia’s crop is expected to about equal last year’s, so it will continue to be a strong competitor.
