As long as world markets and the economy pick up the pace over the next few years, canola has everything else going for it from a food, feed and fuel standpoint, delegates attending the recent annual Canola Council of Canada (CCC) conference learned.
Canola oil has the nutritional properties to meet increasing demands for healthier human diets, the meal can be a price-competitive protein and energy source in livestock rations, and it can be a valuable component in biofuel blends as the world sources more environmentally-friendly, renewable fuels.
That doesn’t mean farmers should seed canola from fence post to fence post — this or any other year — but “keep canola in your rotation” does sum up a relatively strong outlook for the Canadian canola industry at least in the mid-term, according to speakers attending the CCC meeting in Toronto.
After a record year in 2008, which saw farmers seed about 16 million acres that yielded about 12.6 million tonnes of seed, the canola council is still on track for seeing sustainable canola production reach 15 million tonnes by 2015.
The plan isn’t to boost production for production’s sake, however. “The demand has to be there, too, to support that type of production,” points out JoAnne Buth, president of the CCC. “We’re not just setting a production target, we also need to see markets and the demand increase over the next five years. We need to see the market grow and develop so it is profitable for all segments of the industry, especially producers.”
Buth, who reviewed the objectives of the CCC’s Growing Great Toward 2015 initiative, says the objective is to develop markets and then produce more acres of higher yielding canola, with improved
Canadian canola production was 12.6 million tonnes in 2008. The industry has seven years to rise only 2.2 million tonnes and meet its 15-million target. Of course production is only half the battle. We also need to find steady markets to consume this output.
quality components such as higher oil content and higher meal protein and energy.
The 2015 program is intended to move canola forward from where production and quality was in 2006. Three years ago, production was about nine million tonnes, yield averaged 30.5 bushels per acre, oil content averaged 42.5 per cent, only about 10 per cent of production was dedicated to designer or specialty canolas, and meal quality averaged 2,000 kcal per kilogram of energy.
The goal for 2015 is to expand export markets and domestic crush to warrant 15 million tonnes of production. To produce that much canola, the industry needs to increase yields to about 40 bushels per acre, boost oil content to about 45 per cent, increase production of designer canola varieties to about 25 per cent of the overall crop, and increase energy (oil content) in the meal by 10 per cent to make canola meal an attractive feed source for poultry producers.
BIODIESEL IS A KEY MARKET
The program to achieve those 2015 goals is firing on all cylinders, says Buth, although much will depend on growth of export markets for Canadian canola and of course, the future of the biofuel industry.
15 MT By 2015 ON TRACk
The Canadian industry exported about 5.2 million tonnes of seed in 2006 and crushed another 3.7 million tonnes, mostly for vegetable oil with a small portion processed for biodiesel. The CCC goal over the next five years is to see seed exports and domestic crush increase to about 7.5 million tonnes each. Of the canola crush, about five million tonnes will be used for vegetable oil, while 2.5 million tonnes will be used for biodiesel production.
Markets and the economy are major factors affecting those goals, says Buth. With the last regulatory hurdle crossed in early March, Canada can now ship GMO canola seed to Europe. It can be used for biofuel production and, with appropriate labeling, the oil can be marketed as vegetable oil. China came along this year as a major customer buying about two million tonnes of Canadian canola seed, oil and meal. China is building its reserves of meal and oil, but it is uncertain whether it will become a stable market.
The current global economy has the biofuel market in a holding pattern. While all the talk two years ago was about growth and expansion, a sharp increase in feed stock prices coupled with falling crude oil prices changed the complexion of the outlook dramatically.
Buth says much of the biofuel future will depend on how world governments handle environment and fuel supply issues. The U. S. government, for example, has expressed commitment to expanding its use of renewable fuels. In Canada, B. C. has already passed legislation to include a five per cent biodiesel blend in diesel fuel used in that province, and Alberta is aiming for a legislated two per cent biodiesel blend in fuel by 2010.
As the economy strengthens and as governments mandate greater use of renewable fuel, the outlook for biofuels — including canola-based biodiesel — should improve.
Lee Hart is a field editor for Grainews out of Calgary. Contact him at 403-592-1964 or by e-mail at [email protected]