(Resource News International) –– Cash bids for mustard in Western Canada continue to remain disappointing and are not likely seen advancing anytime soon.
“There is really an absence of demand from the European Union and that has hurt the bids,” said Mike Jubinville, a market analyst with ProFarmer Canada in Winnipeg.
Part of the decline in European buying interest of Canadian mustard has reflected cyclical patterns as well as increased production in the EU, he said.
The anticipation of lower prices for mustard as supplies increase also was tied to the reduced demand factor.
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“We have just come off a cyclical high for mustard prices in Canada due in part to tight supplies,” Jubinville said. “Normally, the time period after that cyclical high has been reached, values tend to trend to new lows for a couple of years.”
Cyclical highs for yellow mustard were said to have reached 50 to 60 cents a pound and for brown mustard, around 40 cents.
Jubinville also noted that European end-users have also asked producers in the EU to increase local mustard output, and that to some degree has also been successful.
There was some talk that EU demand for Canadian mustard had dried up because of contamination with genetically modified organisms (GMOs), but that does not appear to be the case, he said.
“There was a shipment of Canadian mustard last fall that was halted because of GMO contamination worries, but was later allowed to continue to its destination after the situation was clarified,” Jubinville said, noting that the shipment arrived at the same time that the EU ban on flaxseed began.
Since then, there have been no further shipments halted, he said.
The outlook for mustard values will continue to be dismal, especially with the supply base larger than what it was in the previous year, he said.
Jubinville predicted that 2009-10 mustard carryout will be in the 104,000-tonne range. Mustard seed carryout in 2008-09 was a very tight 30,000 tonnes.
Yellow mustard bids delivered to the elevator, based on data from Prairie Ag Hotwire, currently range from 21 to 22.8 cents per pound, while browns range from 15 to 16.5 cents. No bids were currently available for oriental mustard.
On March 1, old-crop bids for yellow mustard ranged from 24.5 to 25.5 cents, for browns from 17 to 18.3 cents and for oriental mustard from 16.5 to 17.3 cents.
New-crop bids for yellow mustard as of March 1, based on Prairie Ag Hotwire data, ranged from 25.5 to 27 cents, for brown mustard 16.5 to 18 cents, and for oriental mustard 15.5 to 17 cents.
