Yesterday Stats Canada released their July production estimates largely inline with trade expectations.
All wheat production was seen 35% lower than last year at 22.9 million mt.
Area harvested was seen 8.5% lower at 22.7 million acres while average yield was decreased 29% from last year to 37.2 bpa.
The decrease in production was primarily in springwheat, which was put at 16.1 million mt, down 38% from last year.
Durum production was pegged at 4.0 million mt, down 39% from last year.
Stat’s Canada’s wheat number is roughly 1 million mt larger than Agri Food Canada’s Ag estimate released last Thursday.
Agri Food Canada Ag put their Canadian wheat (excluding durum) production at 20.2 million mt.
USDA’s number for Canadian wheat production is at 24 million mt.
Stat’s Canada report put Canadian durumwheat production at 4.0 million mt, down 39% from last year.
This is in line with trade’s number and slightly higher than AAFC’s 3.8 million mt estimate.
Meantime, widespread rain across North America has slowed harvest and will not be good on quality.
However strong demand should limit the impact of this.
In particular, spring wheat harvest is 25% complete in Saskatchewan , up only 12% from the week previous.
Alberta is 15% done with an average yield of 30.2 bpa.
Durum harvest in Saskatchewan is 33% complete, up 11% from the week previous.
Yields remain dismal.
Meantime, Canadian wheat exports for week 3 were 187.3k mt for a season total of 979.5k mt.
This is 77% (-287k mt) of last year’s to date amount.
Canadian durum exports for week 3 were 28.7k mt for a season total of 258.5k mt, 12% (27.5k mt) more than last year.
The sharp rally we have seen in Canadian prices suggests offshore interest in North American durum.
For this week, started August 30, Canadian wheat prices for FOB delivery were (Cdn$/mt):
– for the N1 class CWRS 13.5% – $496,41, down $3.12 per tonne;
– for the N2 class CWRS 13.0% – $488,02, down $4.65/t;
– for the N3 CWRS – $406,49, up $2.77 ;
– for the N1 CWAD – $743,92, down $2,59 per tonne.
(1USD=Cnd$1.261).
General View:
Wheat is leading the market on a slew of tenders.
The size and quality of the crop remains in question and consumers have limited cover.
Stocks in exporting countries are low, and yields have not been improving as harvest continues.
The millingwheat market is firm with bids around $10.60/bu.
Its expect the wheat market to remain strong.
About Canadian farmers, seems that they don’t rush to sell right now, other than for durum, which may a good opportunity to provide them cash flow, seen high price.
Indeed, these are the highest durum prices and the biggest premiums over spring wheat that we have ever witnessed.
