CNS Canada — Mustard prices have been drifting lower but oriental varieties have been showing relative strength.
Despite a turbulent growing season, complete with hailstorms and excess rain, a prominent mustard merchant says most of the samples he’s seen to date are No. 1 grade.
Walter Dyck, a buyer with Wisconsin-based Olds Food Products, said he’s pleased with what he’s seen from his growers in Montana, North Dakota, Alberta and Saskatchewan.
While yields may not reach the lofty heights of 20 bushels an acre some analysts predicted before the growing season began, Dyck says the quality still looks quite good.
As far as prices go, Dyck said they are slightly below where they probably should be.
“The prices have moved lower. There were acres that went in without a contract in all three varieties, so those crops might be in the market right now,” he theorized, adding that spot prices are at the “bottom end of possibilities” for what new-crop contracts may go for in January.
According to Prairie Ag Hotwire, yellow and oriental mustard as of Wednesday were both receiving spot bids as high as 32 cents a pound while brown mustard was bringing up the rear at just 27 cents a pound.
Kevin Hursh, executive director of the Saskatchewan Mustard Development Commission in Saskatoon, said it’s strange to see oriental mustard drawing higher bids than brown.
“We’re seeing some price strength because production has lagged the needs out there. You don’t usually see oriental stronger than brown,” he noted.
Hursh also pointed out that in 2010, insured and non-insured acres of mustard were much different than today.
Acreage numbers for the main growing area of Saskatchewan in 2010 showed yellow plantings at 119,000 acres, brown at 42,000 and oriental at a whopping 81,000. But with the drop in price came a remarkably different picture.
In 2013, oriental fell to just 23,000 acres while brown soared to 77,000; yellow remained the leader at 86,000 acres.
“Production was higher than market needs and it’s taken a while for oriental to work through that and the pendulum has swung the other way,” said Hursh.
Traditionally, oriental mustard is bought by Asian companies that extract the oil for various purposes. Brown mustard goes primarily to Europe for Dijon mixes while yellow is shipped to the U.S. for use on foods such as hot dogs.
In 2014, Hursh noted, the ratio stayed pretty much the same, with all three crops enjoying expansions in acreage.
“It was 147,000 (acres) for yellow, 107,000 for brown and 35,000 for oriental, so everything increased but the increase was more dramatic in yellow and brown acreage,” he said.
Ukraine has traditionally been a huge competitor for Canadian mustard, but thus far Dyck hasn’t noticed any difficulty competing.
“(There’s) not a lot of export pressure from the Black Sea region; they have their stable market in Western Europe (as) they supply most of the yellow market in Europe. We aren’t seeing any more pressure than we normally do.”
With the harvest completed, mustard has already begun to move out to its various buyers who contracted most of it in advance.
The crop first heads to cleaning plants, Hursh said, before it’s put into containers and shipped by rail.
— Dave Sims writes for Commodity News Service Canada, a Winnipeg company specializing in grain and commodity market reporting.