WINNIPEG – Exports of wheat and barley so far this crop year are significantly lower than this time last year. And last week, a Statistics Canada report confirmed the reason for lagging exports: Farmers don’t have a lot of old-crop grain in their bins.
In Western Canada, on-farm stocks of the six major grains as of July 31 were placed at 2.435 million tonnes. Record lows were reached in 1985, at 2.4 million tonnes.
A Canadian Grain Commission statistician said the first few weeks of any new crop year see low export activity. But Peter Kuzyk said this year is lower than average because “there’s so little grain in the system.”
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According to commission reports, 960,800 tonnes of wheat had moved as of Aug. 27 – just over half what was exported at this time last year.
In the case of barley, only 38,900 tonnes have been exported in the new crop year, compared to 203,700 tonnes last year.
Lots of elevator room
“We’ve got over 70 percent space in the country elevator system right now. So basically, there’s no grain,” said Canadian Wheat Board spokesperson Brian Stacey. “That’s why the exports are down so far this year.”
Stacey said the CWB was expecting a tight supply situation, and took it into account when planning its sales program.
“If harvesting were to be delayed an inordinate amount because the weather doesn’t co-operate, it might mean we might run into some situations where we’d be a little short to cover some vessels that might come in,” Stacey said. “But right now, we’re not anticipating any major problems.”
However, a market analyst with Manitoba Agriculture said lags in exports could have an effect in the long run. “There’s a limit in transportation capacity, in the first place,” Carol Gunvaldsen said. “So we want to keep grain moving as much as possible.”
Stacey said exports will likely be down this crop year from last, although he didn’t want to put a number to it. “But without doubt, we’re going to be down substantially, primarily because of the low carry-in, but also … the crop (this year) is certainly by no means any record.”
Gunvaldsen said the Statistics Canada report confirmed low stocks the grain trade suspected.
Exports up, production down
Canada-wide, wheat stocks fell to 545,000 tonnes, the lowest level since 1989-90. Statistics Canada attributed the low number to strong exports last year and a 23 percent drop in production. Durum stocks were at record lows because of a 39 percent increase in exports.
Statistics Canada reported a decline in barley production along with increased livestock feeding accounted for low stocks of that crop. The report also said there was a 21 percent drop in barley exports last year because of short supplies.
Gunvaldsen said world stocks will likely be low for the next few years, so farmers should be able to get prices higher than they’ve received in the past several years.
“The (farmers) that have the crop and can take it off in good condition, it will certainly help ease the pain of transition (to paying full freight rates),” she said. “For those who don’t, that’s another situation.”
