The landscape of North Dakota and Minnesota will take on a distinctly yellow hue this summer.
Farmers in those two states are expected to plant at least one million acres of canola this year, an increase of more than 60 percent from 1997.
Total seeded area in the United States could reach 1.4 million acres, say industry officials, nearly double last year’s record 730,000 acres.
With wheat prices down and disease problems taking their toll on cereal crops, farmers in the northern Great Plains are looking to the oilseed as a money-making alternative.
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“Canola has been paying well and the information has gotten out,” said Tom Borgen, a Langdon, N.D., farmer and president of the Northern Canola Growers Association.
Changes in U.S. federal crop insurance rules allowing full coverage for canola have also provided an incentive for more farmers to try the crop, as has the increased planting flexibility allowed for by the 1995 U.S. farm bill.
All that new American production could cut into exports of Canadian canola seed south of the border, averaging around 300,000 tonnes annually.
“As U.S. acres of canola expand, one can expect that unless they expand their processing, seed exports will be pressured downwards,” said Dale Adolphe, president of the Canola Council of Canada.
Not overly worried
But despite that, he said, the dramatic growth in U.S. production in the last few years is not yet being viewed negatively by the Canadian canola industry.
Canada currently ships about 500,000 tonnes of oil and one million tonnes of meal to the U.S., and industry officials say there is still room for growth in consumption.
“Any incremental oil and meal production increase wouldn’t affect the U.S. as an oil and meal market, we don’t think,” said Adolphe.
The U.S. is a preferred customer, paying premium prices, paying cash and paying on time. But Adolphe said a decline in seed exports would become cause for concern only if Canadian exporters couldn’t find other markets for the displaced seed.
“The pressure hits the fan when we start to carry over burdensome stocks from one season to the next,” he said. “That’s not the case and we think we still have a good market in the U.S.”
In North Dakota, an estimated 1,500 canola growers are expected to plant about 825,000 acres this year, up from 500,000 acres last year, while in Minnesota the seeded area is expected to approach 200,000 acres, up from about 100,000.
Another 200,000 acres or so could be planted in states like Montana, Idaho, Washington, Georgia and South Carolina.
Borgen said he is a little concerned that canola acres in North Dakota may be spreading into “fringe” areas, encouraged in part by three or four years of unusually wet weather.
“I’m a little afraid that if they get a normal year, those new growers, it’s going to burn up and they’re going to take a loss,” he said.
Researchers say North Dakota could maintain a proper rotation of about one million acres, while Minnesota canola industry officials have set a target of 500,000 to 800,000 acres.
One of the key issues facing the U.S. industry is the availability of pesticides.
While growers in Canada have more than 40 crop protection products to choose from, in the U.S. only eight are registered for use.
That has limited yields to 15 or 16 bushels an acre, discouraged some farmers from even trying canola because of concern over weed control and diseases like sclerotinia and prevented the import of treated seed from Canada.
Many products used in Canada don’t have any tolerance levels for export to the U.S. because they have never before been in demand.
Small market
Megan Marquet, assistant director of the U.S. Canola Growers Association, said the association wants pesticide regulations on both sides of the border standardized.
She said her group has had little success to date convincing the regulators to go along with the idea or to get chemical companies to make it a high priority issue, given the relatively small market for canola products in the U.S.
