Statistics Canada should show an increase in Canadian wheat and canola production in its upcoming final crop report of 2013 on Wednesday, industry participants said.
Record-large yields reported in many areas, and the fact that the survey for StatsCan’s last report was done before many people were finished harvest, were said to be pointing to an increase in production figures for both canola and wheat.
In its Oct. 4 report, Statistics Canada pegged all wheat production at 33.03 million tonnes for 2013-14, while expectations call for an increase into the 33.33 to 35 million-tonne range. In 2012-13, Canadian producers grew 27.21 million tonnes of wheat.
StatsCan is also expected to increase its canola production figure in the upcoming report. On Oct. 4 the agency estimated Canada would produce a record-large 15.963 million tonnes of canola in 2013-14.
However, trade guesses go as high as 18 million tonnes, due to the record-large yields seen across the Prairies, said Keith Ferley of RBC Dominion Securities in Winnipeg. The 2012-13 Canadian canola crop totaled 13.87 million tonnes.
A larger Canadian canola crop is priced into the market to some degree, but the report could still be surprisingly bearish or bullish for the futures market once it’s released, said Ken Ball of PI Financial in Winnipeg.
“It could be a surprise. It might go up more than we think, or it might be less,” said Ball. “But everybody is trading on the basis that supplies of canola are sizeable and more than ample.”
Ferley said he wouldn’t be surprised if the numbers come in below trade expectations, as farmers may have downplayed their yields in the survey.
“Growers are going to try and keep the yields down,” said Ferley. “They’re going to downplay (yields), thinking that it’s going to help prop the market up.”
The federal statistics agency will likely also make some adjustments to the other major crops grown in Canada in Wednesday’s report, as harvests were mostly complete when they conducted the survey in late October/early November and large yields were seen for many crops.
Durum, oats, barley, flax and peas are all expected to see slight production increases, according to analysts.
“There is a lot of grain out there,” said Ferley. “It’s bagged all over the place.”
– Phil Franz-Warkentin writes for Commodity News Service Canada, a Winnipeg company specializing in grain and commodity market reporting.
Table: Trade expectations as of Dec. 3, 2013, ahead of StatsCan’s Dec. 4 crop report. Figures in millions of tonnes.
|Canola||16.600 – 18.000||15.963||13.869|
|Durum wheat||5.500 – 5.700||5.579||4.627|
|All wheat||33.325 – 35.300||33.026||27.205|
|Oats||3.225 – 3.400||3.163||2.812|
|Barley||9.400 – 9.475||9.247||8.012|
|Peas||3.900 – 4.000||3.781||3.340|