Spring rain is spoiling the triumphant return of flax to its pre-Triffid levels.
Growers told Statistics Canada they intended to plant 1.7 million acres of the crop, which is the same amount seeded in 2009, the year that Canadian flax shipments were found to be contaminated with an unapproved GM flax variety.
The following year, growers planted less than one million acres of the crop because of the loss of the European market.
However, China has emerged as a major new buyer, demand is strong in the United States and sales to the European Union have resumed.
Read Also
Critical growing season is ahead for soybeans
What the weather turns out to be in the United States is going to have a significant impact on Canadian producers’ prices
Flax prices are strong and growers have responded, but excessive moisture has tempered their enthusiasm.
“We often buy a fair bit of flax along the Manitoba-Saskatchewan border,” said Dale Heide, general manager of Delmar Commodities, a grain company headquartered in Winkler, Man. “Those boys didn’t get their seeding done and flax is certainly one of the weakest crops when it comes to high moisture conditions.”
He thinks rain has washed away 200,000 acres, but it will still be a much bigger crop than the one million acres that went in the ground last year. That’s a good thing because carryout is miniscule.
“The old crop supplies are very, very small. What is left over seems very tight,” said Heide.
“There is probably some inventory, but you can’t get at it.”
Old crop prices in Manitoba are $14.50 per bushel compared to $11.50 to $12 for new crop flax.
John Duvenaud, market analyst with Wild Oats Grain Market Advisory, said demand for the crop has been terrific.
“For a couple of years there after that Triffid thing came along, you couldn’t give the stuff away,” he said.
However, China has quickly be-come the top buyer of the crop. It has bought 213,801 tonnes through the first 10 months of the 2013-14 marketing campaign.
“They figured out real quick what we figured out years ago, that flax is quite a healthy product,” said Duvenaud. China used to buy flax only when prices were low, but it has become a steady buyer of the crop even at today’s prices.
“They found out the value of it, and now they’re paying up for it,” he said.
As well, disappointing crops in Ukraine and Russia last year pushed European buyers back to Canada to fill their needs.
“I would say we’ve got a pretty good market right now,” said Duvenaud.
He expects supplies will be adequate to meet the anticipated demand in 2014-15.
Heide is pleased growers are returning to flax production.
“As the more acres come into play, we’ll certainly go and look for some new homes and find some more of that Asian business that we’ve kind of been passing on just because we couldn’t buy enough out here,” he said. “The market is big enough to accommodate any type of growth in the acres, for sure.”
However, he believes acreage expansion will be capped by the crop’s poor agronomic performance.
“No good new breeding is happening on flax,” said Heide.
Growers need to see yields of 35 to 40 bu. per acre instead of the 20 to 25 bu. per acre that they’re now getting.
