CNS Canada — Persistent concerns over the state of the U.S. spring wheat crop should place more attention than normal on Canada’s wheat area when Statistics Canada releases updated acreage estimates on Thursday.
Ahead of the report, trade estimates for all-wheat area range from 21.5 million to 23.2 million acres, which would compare with the 23.2 million seeded in 2016. Of that total, durum area is generally expected to be down by at least a million acres from the 6.2 million seeded the previous year.
“The trade will closely watch the wheat number, because of the conditions in the US spring wheat area,” said Jerry Klassen, manager of Canadian operations with Swiss-based GAP SA Grains and Products in Winnipeg.
The bulk of the rally in the Minneapolis futures came after it was too late to shift Canadian seeding intentions, he said, which means the market will be highly sensitive to a smaller than expected spring wheat or durum number from StatsCan.
Trade estimates for canola area range from about 21 million to 22.7 million acres, which would be well above the 20.4 million seeded in 2016.
With carryout expected to be tight at the end of the 2016-17 crop year, “we need the larger acreage,” said Klassen.
“Canola is the clear-cut winner,” added analyst Neil Townsend of FarmLink Marketing Solutions.
However, Townsend said, StatsCan’s total acreage base for all crops looked large in the previous report. Even factoring in summerfallow, he said the total seeded area was about 1.5 million acres above the previous record. He questioned whether some of that land would be scaled back in the June report.
Adverse spring weather in some areas of Western Canada also raised some questions over whether seeded area was able to live up to expectations.
Mike Jubiville of ProFarmer Canada estimated as much as three million acres may have been unseeded this spring, with about half of that originally intended for wheat.
However, other analysts were more optimistic, with both Klassen and Townsend of the opinion that most of the wetter areas were eventually seeded — albeit later than normal.
Lentils and peas are both expected to see a reduction in acres on the year, but soybeans are gaining ground in the Prairies.
Table: Pre-report trade guesses, in millions of acres.
|Pre-report estimates||StatsCan April||StatsCan 2016|
|Canola||21.000 – 22.700||22.387||20.367|
|Flaxseed||0.900 – 1.100||1.115||0.935|
|Lentils||4.000 – 5.000||4.385||5.86|
|Oats||3.200 – 3.500||3.419||2.834|
|Peas||3.800 – 4.200||3.989||4.239|
|Total wheat*||21.500 – 23.200||23.182||23.212|
|Durum||4.900 – 5.100||5.145||6.19|
Source: Phil Franz-Warkentin writes for Commodity News Service Canada, a Winnipeg company specializing in grain and commodity market reporting. Follow Phil at @PhilFW on Twitter.