Canadian farm officials, for a third time, cut their estimate for the domestic wheat harvest, dashing hopes of a recovery in exports from, historically, the world’s third-ranked shipper of the grain.
Canada’s farm ministry, AAFC, gave up on hopes that harvested area of wheat, excluding the durum variety used in making pasta, would rise from last year’s rain-effected levels, following a second season of dismal weather for growers.
"Subsoil moisture conditions range from adequate to excessive," AAFC said, adding that the conditions had left crop development "significantly more uneven than usual".
The estimate for harvested area was cut by 330,000 hectares to 6.96m hectares, compared with 7.02m hectares for last year’s crop.
With prospects for durum output waning too, Canada pegged its total wheat harvest at 23.0m tonnes, 1.0m tonnes below its previous estimate and taking its forecast 167,000 tonnes below last year’s result.
‘Low inventories’
The downgraded production estimate prompted the ministry to cut by 800,000 tonnes to 16.1m tonnes its forecast for exports in 2011-12, ditching hopes of a rebound in shipments from last season, when 16.5m tonnes were shipped.
The estimate for inventories at the close of 2011-12 was kept at a "low level" of 5.0m tonnes, a figure beneath which stocks have fallen only once, four years ago, in at least the last half century.
US Department of Agriculture attaches in a report published on Wednesday foresaw a lower harvest figure for Canada, of 22.4m tonnes, but higher exports, of 17.0m tonnes, leaving carryout stocks even thinner, at 4.6m tonnes.
The briefing also highlighted a potential impact from delays in spring sowings, noting "concerns that wheat quality may be impacted if there is an early frost", before farmers can gather in their harvest.
Canola prices
AAFC also trimmed estimates for harvests of coarse grains and oilseeds, thanks to lower estimates for the area that would make it through to harvest.
However, it stood by a forecast of a record 13.4m-tonne harvest of canola, the rapeseed variant thanks to better hopes for yields, adding that farmers could expect higher prices for the oilseed than the Can$567 a tonne they received in 2010-11 as well.
"Prices are forecast to rise on support from high world prices for soybeans, palm oil and crude oil," the ministry said, lifting its estimate for 2011-12 values to Can$580-620 a tonne, from Can$560-600.
http://www.agrimoney.com/news/canada-cuts-wheat-harvest-hopes—for-a-third-time–3443.html
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