Canola Acres Up, Wheat Down

Written February 1, 2009

Agriculture Canada expects area seeded to spring wheat and durum wheat this spring will be down significantly from a year ago, while it expects canola acreage to set a new record.

In its first look at what Canadian producers plan to plant in the 2009-10 crop year, the market analysis branch of Ag Canada pegged total wheat at 23.895 million acres, with durum accounting for 5.609 million acres of that. Canadian growers seeded 25.009 million acres to all wheat types in 2008, including 6.030 million of durum.

Seeded area to canola, meanwhile, is forecast to jump to a record large 16.803 million acres from the record 16.159 million seeded in 2008.

Canola continues to budget out well given its strong yield potential. Significant improvements in canola seed varieties have also increased the crop’s ability to tolerate disease and, in turn, a more frequent planting rotation.

The Ag Canada report put area seeded to barley was expected to increase slightly to 9.674 million acres in 2009 from 9.357 million in 2008. Oats area is seen holding relatively stable at 4.374 million acres in 2009 compared with 4.345 million in 2008.

The area left as summerfallow in 2009 is estimated at 6.042 million acres, down slightly from the 2008 level of 6.069 million.

Here are some of the other crops, with 2009-10 forecast seeded acres first, with 2008-09 behind in brackets: flax, 1.556 million (1.560 million); peas, 3.706 million (3.996 million); lentils, 1.804 million (1.611 million); mustard 0.519 million (0.479 million); sunflower 0.178 million (0.170 million); canaryseed 0.445 million (0.415 million); and chickpeas 0.210 million (0.131 million.)


The total price that farmers can eventually expect to receive for malting barley sold through the Canadian Wheat Board’s designated barley pool should be right around the expected price level announced in the January Pool Return Outlook. That’s because the CWB is closing the malt barley pool and intending to use the CashPlus program for future malt barley sales for the remainder of the currently marketing year. CashPlus offers producers an upfront cash price.

The move is designed to shelter the current CWB malt barley PRO from further downward price pressure tied to large global supplies of malting barley. The current CWB PRO for special select two-row malting barley is $5.50 per bushel delivered to an elevator at midpoint Saskatchewan. This is great for producers already accepted into the pool, but not so great for those growers shut out.

Malting barley sales through CashPlus for the balance of the crop year are likely to be at values of around $4 bushel. That’s still considerably better than the feed barley price, but it’s a major drop from the pool value.

So far the CWB says it is on track for record bulk malting barley exports in 2008-09 of at least 1.4 million tonnes.


Cash flaxseed values have been edging higher again recently, working slowly above the $10-per-bushel level in Manitoba and Saskatchewan. Premium prices have been as high as $11 (for Mar/ Apr movement.)

PFCanada has even seen reports of new crop bids for 2009 production now coming up. There is one small program available for new crop brown milling flax at $11.50 per bushel picked up in southeast areas of Sask for Sept/ Nov movement. This contract also has a full act of God clause (variety specific).

There is some interest in new crop yellow flax as well with indications of $14 per bushel fob farm, but there are currently no contracts to report at this time.

Flax is starting to get interesting again. PFCanada is already sold out for 2008 production, but for growers still holding unpriced old crop, be on the lookout for a move back towards $12 or more per bushel on both old and new crop in the weeks and months ahead. The supply/demand balance for flaxseed remains tight and thus far does not show signs of significant improvement. Even going out into the 2009-10 marketing year, supplies will remain tight.

Before taking the New Year’s holiday week (Jan 26-30), China has reportedly demonstrated some interest — supposedly in the area of $11 per bushel Saskatchewan equivalent. It’s likely such demand competition will soon inspire more traditional European buying interest ahead of the St. Lawrence Seaway opening in March on ideas the flax market may be bottoming. However be aware: A move towards $12 again on old crop is likely to inspire the next round of farmer selling which could slow upward momentum from there for a while.

Core demand for flaxseed seems to reside near 850,000 tonnes — the volume which is “must have” for the industry. That doesn’t mean users at that point can be squeezed to any price, but the propensity to ration demand down further seems limited.

It’s been our assumption to date that in order to maintain new crop acreage at levels to sustain current demand expectations, flaxseed prices would need to maintain a “relative” $2-per-bushel premium to canola. Maybe it’s $3? Nonetheless, given current supply/ demand expectations, and assumptions of $10 canola at some points in the new marketing year, then it would seem to me that the flaxseed market needs to visit the $12 area at least one time before seeding to at least maintain acreage or build on it slightly. And it seems like the market is moving in that direction right now, albeit gradually.

Mike Jubinville runs Pro Farmer Canada from Winnipeg and can be reached by e-mail at [email protected],or through his web site at

Pro Farmer Canada is for informational purposes only. The publisher and its agent or employees shall not be liable for any loss or damage suffered by any person as a result of reliance on any of the contents contained within these products; whether such loss or damage arises from negligence or mispresentation or any act or omission of the publisher or its agents or employees.

About the author



Stories from our other publications