REGINA – As the clock approached noon on the second day of the Canadian Special Crops Association convention, traders and exporters came to the consensus that many industry analysts were out to lunch.
Presenters speaking at a production prospects session took issue with harvest forecasts from some of the industry’s top analysts.
Some questioned the pea estimates of 2.7-2.8 million tonnes, saying the crop will come in closer to 3.2-3.5 million tonnes.
Others felt industry forecasts were overstating the size of the upcoming crop, including Greg Simpson, who delivered the lentil outlook along with a harsh criticism of Stat Publishing’s supply and demand estimate.
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The markets newsletter is forecasting 2004 Canadian lentil stocks of 887,000 tonnes, based in part on carry-in stocks of 49,000 tonnes. Simpson took umbrage with that carry-in number.
“I’ve never seen inventory so low in Saskatchewan,” said the owner of Simpson Seeds Inc., one of Canada’s largest lentil exporters.
“The bins are swept out, farmers have cleaned up, the trade has shipped out. There’s virtually hardly any inventories out there.”
Other processors attending the conference agreed with his assessment. Simpson said the 49,000 tonne carry-in number is an error that needs to be corrected by scaling back last year’s seeded acreage total to 1.26 million acres from 1.37 million acres.
Starting with a smaller base in 2003 leads to a smaller 2004 lentil crop. When he factors in another 100,000 acres lost to flooding, Simpson arrived at 1.55 million acres instead of the 1.88 million acres used by Stat Publishing.
Using an average yield of 1,100 pounds per acre he calculated a total supply of 759,500 tonnes, which is 14 percent smaller than Stat Publishing’s estimate.
“We’re not as long as everybody thought,” concluded Simpson.
Stat Publishing wasn’t the only target of the day. Roy Legumex Inc. president Ivan Sabourin set his sights on the federal government, saying he was bewildered by Statistics Canada’s June estimate of seeded bean acres.
“I’m not sure where they’re coming from,” he said, shaking his head in disbelief.
According to Statistics Canada, growers in Manitoba planted 160,000 acres of navy beans in 2004. But Sabourin recently spoke to an official at Manitoba Crop Insurance who is projecting 92,000 acres of navies after reviewing 82 percent of grower insurance applications.
“It’s frustrating when you try and trade on (the Statistics Canada) number.”
Sabourin had good news to share with Canadian bean growers. He recently returned from a dry bean conference in the United States where production is estimated to come in at 20.4 million bags of beans in 2004, down from 22.4 million bags in 2003.
“The general consensus is that the huge, burdensome carryover that we’ve had over the last couple of years is not as bad as it has been.”
He also forecast a 12 percent decline in Canadian bean production to 5.8 million bags from 6.6 million one year ago.
“There is some optimism out there in most varieties,” he said.
Speakers who delivered the mustard and canaryseed outlooks had minor quibbles with Agriculture Canada’s latest forecast, both projecting slightly bigger crops.
They pegged canaryseed at 297,000 tonnes and mustard at 254,000 tonnes compared to government estimates of 280,000 and 240,000 tonnes respectively.
Whatever number is used represents about two years of production for both crops, said Steve Foster, senior merchandiser with Saskatchewan Wheat Pool.
“It’s going to skew the market a bit. We’re going to see depressed prices.”
Last week, the going rate for mustard dropped $15 US per tonne in Europe and buyers didn’t bite.
“Nobody is going to sell and nobody is going to buy. It’s just going to be a wait and see game. Everybody is looking for a weather scare,” said Foster.
