Canadian farmers intend to plant more barley and corn for grain in 2016 than in 2015, but smaller areas of wheat, canola, soybeans and oats, according to Statistics Canada’s March Farm Survey. The survey, which collects information on crop planting intentions, was conducted from March 16 to March 31 and included about 11,500 farmers. Farmers were asked to report their planting intentions for grain, oilseeds and special crops.
The following table is a recap of Statistics Canada’s acreage report for the period ended March 31, 2016. Pre-report expectations are provided for comparison purposes. Figures are in million acres.
Canola/Flax
Canadian farmers reported that they intend to sow 19.3 million acres of canola in 2016, down 4% from last year.
Saskatchewan producers reported that they intend to seed 10.4 million acres, 2.6% lower compared with 2015. Farmers in Alberta also anticipate decreasing their canola planted area by 7.8% in 2016 to 5.6 million acres. Manitoba farmers reported no change in the size of the canola area (3.1 million acres) they intend to seed in 2016.
This canola number is a bullish surprise -- down 0.75 million acres from last year even with most of the trade thinking at least steady to a small increase. My guess was 20.5 million acres. Combined with emerging dryness issues for the western Prairie region and continuing strong demand (crush/exports), it suggests to me that the canola supply/demand balance for 2016-17 will continue a trend towards eroding carryout -- .potentially below 1 MMT for the new crop marketing year, which is starting to look tight.
On flaxseed, StatCan predicts 2016 acreage falling sharply to 1.115 million acres, down 32% from last year. That’s a bigger than anyone expected. No sure yet how that is going to ultimately impact the flax market...but it ain’t bearish.
Wheat
Nationally, farmers reported that they intend to plant 23.8 million acres of wheat in 2016, down 1.1% from last year but within the range of trade expectations. Planting intentions for spring wheat are 16.0 million acres, 1.0 million acres lower than in 2015. Meanwhile, durum wheat is expected to grow 5.2% to 6.1 million acres. Winter wheat remaining for harvest is expected to increase 31.6% to 1.7 million acres in 2016.
Each of the Prairie provinces expected lower seeding areas for wheat compared with 2015, while farmers in the East anticipate seeding more wheat.
The Canadian wheat numbers on their own will have no market impact from the broader perspective, though is a contributing factor to a global trend of declining wheat acres and presumably production for 2016-17.
Pulse Crops
As expected, big increases anticipated for lentil and pea crops this year will be realized...lentils at 5.140 million acres ( 30%) and peas 4.280 million ( 16.3%). The lentil number is certainly big, but is within the range of trade expectations...no breakdown on type. The peas, higher yes, but actually a little smaller than expected -- bit of a surprise there.
Soybeans
Farmers intend to plant 5.3 million acres of soybeans in 2016, down 1.9% from 2015.
Ontario remains the province with the largest soybean planted area, as producers are expecting to seed 2.7 million acres, accounting for around half of the national soybean area anticipated in 2016. However, the province’s intentions are down 7.8% from last year.
Producers in Manitoba, the province with second largest soybean area, intend to sow 1.5 million acres of soybeans in 2016, an increase of 10.1% compared with 2015. Quebec producers expect to plant 783,300 acres of soybeans, up 0.6% from the previous year.
Barley and oats
Barley seeded area is expected to rise 3.8% from 2015 to 6.8 million acres, with the Prairies accounting for 95% of planting intentions. Not as big a gain as I expected given the economic attraction of trying for malt this year.
Oat planting intentions for 2016 are 3.0 million acres, down 10.9% from 2015. Alberta is the only province to report an anticipated increase in oat area, with farmers expecting to seed 730,000 acres, 9.0% more than in 2015. Number is about as expected, but still difficult to imagine a sustained turn higher for oat prices as commercial supplies remain plentiful on either side of the Canada/US border. Going to need new crop weather threats and/or bullish leadership from the likes of wheat and corn markets to give oats a lift.
Corn for grain
National corn for grain seeding area is expected to rise 6.2% in 2016 to 3.5 million acres. Ontario farmers anticipate planting 2.2 million acres, up 4.6% from 2015. In Quebec, corn for grain area is expected to increase 4.1% to 939,000 acres.
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