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Canadian Farmers Plant Above-Average Wheat

Canada’s farmers managed to plant better-than-average crop areas of total wheat, durum and canola despite a cool spring, floods in Manitoba and dry weather elsewhere, Statistics Canada says.

The forecast slightly exceeded traders’ estimates of total wheat and canola, Canada’s two biggest crops.

“It’s pretty rare for growers not to seed,” said Ken Ball, a futures and options broker with Union Securities. “It’s what they do. Most growers will seed even if it may be economically unwise to do so.”

Excessive moisture has caused Manitoba farmers to leave an estimated 900,000 acres (364,000 hectares) unplanted, but StatsCan forecasts overall summerfallow acres to decline three per cent to 5.9 million acres.

“Summerfallow doesn’t pay the bills,” another grain trade source said of farmers’ determination to plant despite poor conditions.

StatsCan’s projections don’t reflect late frosts across the Prairies this month and drought conditions that worsened after StatsCan had finished surveying 25,000 farmers between May 25 and June 3.

As a result, as much as one-third of the acres forecast by StatsCan likely reflects farmer intentions rather than seed in the ground, Ball said.

Canola was the most vulnerable to frost, causing some farmers to reseed and others to expect crops with a thinned-out plant population. Most of those who replanted switched to barley or durum from canola, which could cause a swing of several hundred thousand acres once StatsCan adjusts its latest estimates, Ball said.

The connection between planted acreage and crop production is more difficult to predict this year because of varied crop conditions, traders and analysts said. Some of the most adverse weather, such as earlier cool weather and now drought in Alberta, has delayed crop development.

“You had so many challenges this year with respect to production,” said Tony Tryhuk, manager of commodity trading for RBC Dominion Securities Inc. “Does this acreage number even mean anything? I think it doesn’t unfortunately.”

Some traders expect canola production to fall to as low as nine million tonnes from 12.5 million last year, Tryhuk said, but he said 11 million tonnes is a more realistic projection.

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