Canadian farmers will harvest 17.5 per cent less wheat and 24.5 per cent less canola, Statistics Canada said Aug. 21 in its first estimate of 2009 crop production. It forecast the all-wheat crop at 23.61 million tonnes, a steep drop from last year’s bountiful harvest, but more than the trade had expected.
Statistics Canada expects the canola crop to drop from record production last year to 9.54 million tonnes, the third-largest crop ever, but almost one million tonnes lower than the trade had expected.
StatsCan surveyed 14,600 farmers between July 27 and Aug. 4.
StatsCan’s forecast doesn’t reflect more favourable weather conditions after the survey period and the potential exists for an additional one million tonnes of canola production, said Tony Tryhuk, manager of commodity trading for RBC Dominion Securities.
“We think this is likely the lowest (canola) number you’ll see all year, notwithstanding the possibility of a frost.”
Heat and rain since the StatsCan survey period, during which the Canadian Wheat Board (CWB) projected a 21 per cent smaller Western Canada wheat crop, gives that prediction some “upside potential,” said Arvin Pirness, market analyst for the CWB.
StatsCan expects a spring wheat crop of 16.15 million tonnes, down 12.3 per cent from last year and durum production of 4.519 million tonnes, a drop of 18.1 per cent.
It forecasts the barley crop to fall 24 per cent to 8.948 million tonnes, in line with trade expectations.
The oat crop is forecast to shrink 30.5 per cent to 2.967 million tonnes – slightly more than the average trade estimate of 2.7 million tonnes.
The U. S. Department of Agriculture said last week it expected a Canadian wheat crop of 22.5 million tonnes, matching an earlier estimate from Canada’s Agriculture Department.
Crops in Western Canada, a key growing area for spring wheat and canola, are two to four weeks behind normal development because of unfavourable weather ranging from drought to excess moisture, causing farmers to hope for frost-free conditions into late September for their crops to mature.
Those concerns are abating for now with no frost in the forecast, said Jerry Klassen, an independent trader and analyst.
Even with a smaller wheat crop, prices won’t necessarily rise, because of big U. S. and European crops, Pirness said.