WHEAT, CANOLA GET A BOOST
Rain helps raise crop yields
Canada’s annual wheat and canola output will fall less than forecast in August after beneficial rain boosted yields, data from the government’s statistics agency showed.
Wheat production will drop 11 per cent to 26 million metric tons this year from 29.4 million in 2014, Statistics Canada said Friday. In August, the agency forecast 24.6 million tons. The latest projection topped 25.4 million, the average of eight analysts surveyed by Bloomberg News.
Canola output will fall 13 per cent to 14.3 million tons from a year earlier, the agency said. In August, the forecast was 13.3 million. Analysts projected 14.4 million.
Canada is the world’s top canola producer and one of the biggest wheat growers. Output of the grain was forecast to drop to a four-year low with the oilseed crop the smallest since 2012 after drought conditions parched parts of the Prairies. Corn, barley and oat production will increase from last year, the latest forecasts showed. The government contacted 9,300 farmers from Sept. 3 to Sept. 13.
“The last survey was taken right as we were in the worst of the dryness,” David Reimann, a market analyst with Cargill Ltd. in Winnipeg, said in a telephone interview. “The rains since then and the moderating of the weather has improved crop prospects.”
Parts of Saskatchewan and Alberta got as much as 1.5 times of the normal amount of rain since April 1. Earlier in the season, areas received less than 60 per cent of average precipitation, and the unusually dry conditions stressed crops.
Yields have returned to their long-term average after a couple of years of being higher than normal, Bruce Burnett, a weather and crop specialist with Winnipeg-based grain marketer CWB, said on a conference call. “We’re still see- ing the impacts of the drought, but certainly the yields have recovered a bit from the rains we received.”
The canola harvest may top the government’s forecast again, weighing on prices in the coming months, Reimann of Cargill said. The latest report was neutral to bearish on spring wheat after the forecast topped expectations, he said.
Spring-wheat futures for December delivery climbed 0.9 per cent to $5.36 a bushel on the Minneapolis Grain Exchange.
Canola for November settlement rose 0.4 per cent to $472.80 a metric ton on ICE Futures Canada in Winnipeg.
Through Thursday, wheat slumped 15 per cent this year, while canola rose seven per cent.