Saskatchewan farmers plan to seed their smallest spring wheat crop in 20 years, according to a survey done by Statistics Canada.
Farmers in the province intend to plant 9.06 million acres of spring wheat, down 16 percent from last year.
Overall, western Canadian growers will plant about the same size wheat crop as they did in 1998, which was the smallest crop since the early 1970s.
The drop in wheat comes as a surprise to market analysts, who thought wheat acres would stay stable or rise slightly.
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If farmers carry through on their intentions, markets may feel the pinch down the road, said Dave Reimann, manager of floor trading operations for Benson Quinn-GMS.
“The more you do of that, sooner or later the scale tips over,” he said.
While farmers will plant 1.8 million fewer acres of spring wheat than they did last year, the report showed they will grow 1.7 million additional acres of durum.
Manitoba farmers will buck the trend by increasing their spring wheat plantings by 16 percent to 3.5 million acres, Reimann noted.
Overall, the first Statistics Canada report of the season verified the trends predicted by analysts, he said.
However, the magnitude of acreage swings was somewhat larger than expected.
The trade expected farmers would grow more barley this spring, but the report shows the increase may be twice as large as earlier predictions.
“Malting markets are looking pretty firm and there’s a good outlook for the coming year,” explained Reimann.
Strong livestock markets are underpinning prospects for feed barley prices, he added.
Barley requires fewer inputs, noted Reimann, and farmers may feel more comfortable growing it if they’re worried about soil moisture.
Farmers will grow 2.44 million more acres of barley than in 1999, but about 2.44 million fewer acres of canola.
Nolita Clyde, analyst with Statcom Ltd., expected a 15 percent drop in canola area, rather than the 18 percent fall to 11.29 million acres.
But she said there’s still time for farmers to change their minds.
“I think we’ll probably find more canola acres than that before we plant,” said Clyde.
Last spring, Statistics Canada’s intentions survey pegged canola acres lower than farmers’ actual plantings, she noted.
Canola has made money for farmers four out of the past five years, said Clyde, and has become a vital part of crop rotations.
While farmers aren’t happy with current canola price levels, Clyde said she expected them to drop more to discourage canola plantings.
“You can’t say that they’ve done well,” said Clyde, “But they are probably higher than they should have been at this point.”
Reimann said the smaller canola crop will leave Canadian farmers with a more normal ending stocks of 600,000 to 700,000 tonnes going into the 2001-02 crop year.
This July, farmers are expected to carry more than two million tonnes of canola to market in the new crop year.
Farmers also plan to cut a third of the flax they grew last summer, which would make it the smallest crop since 1993.
Reimann said the cut will be a good start to relieving depressed flax prices, and may help improve fundamentals by 2001-02.
Statistics Canada’s next survey will measure what farmers seeded. Reimann said traders will watch the report, due in May, more closely than the April intentions survey.
“I think we tend to treat (the first report) as a bit of a barometer,” Reimann said.
