Prairie flax prices have declined throughout the growing season, but Will Hill, president of the Flax Council of Canada, said he expects prices to remain steady into harvest due to the tight carryover stocks from the previous season.
“I think we’ve seen prices come off from the highs earlier in the year to reflect the drop in general world oilseed prices, along with the fact that we got a little larger crop coming here in Canada,” he said. “We have fairly low stocks going into harvest, so that’s why I’m thinking the current spread to canola is probably going to be maintained.
“But again, if world oilseed prices turn lower, then flax will follow,” Hill added.
In terms of global demand, Hill said the Black Sea region is competition in Europe, but demand for Canadian flax in China and the U.S. should offset losses there.
“It has been filling the gap in Europe, but up until now, we’ve been able to fill that gap in the U.S. and China,” he said. “The U.S. has a smaller crop again this year, so there will be good demand from there.”
Harvest hasn’t started yet, but warm weather across the Prairies in recent weeks has helped speed up crop development, Hill said.
“Flax is generally harvested a little later than canola, but I think this warm weather is exactly what we needed to bring this crop along, because it was quite late,” he said. “Generally flax stands up fairly well against adverse weather, so I think it’s far enough along that it should be OK.”
According to Prairie Ag Hotwire’s prices for Tuesday, FOB farm flax is topping out at $14.50 per bushel.
— Brandon Logan writes for Commodity News Service Canada, a Winnipeg company specializing in grain and commodity market reporting.