June 28, 2012

 

 

Statistics Canada said on Wednesday (June 27) that Canadian farmers increased record-high rapeseed plantings more than anticipated and slashed the wheat area from an earlier forecast, but traders noted the agency's farmer survey did not capture heavy rains that may have washed out many fields.

 

Rapeseed plantings reached 21.273 million acres, near the high end of a range of trade estimates. Rapeseed seedings were up from Statscan's April 24 estimate of 20.4 million acres and well past last year's area of 18.9 million acres.

 

All-wheat plantings slipped to 23.812 million acres, slightly lower than trade expectations. Wheat plantings slipped from the previous estimate of 24.3 million acres, but still exceeded last year's seeded area of 21.5 million acres.

 

Statscan surveyed nearly 25,000 farmers from May 28-June 7, prior to steady rains pouring down in western Manitoba and eastern Saskatchewan.

 

"We've got to knock a chunk off for lost acres unseeded, swamped out with all the rains in June," said Ken Ball, commodities broker at Union Securities, who estimates farmers lost at least one million acres of rapeseed. "Putting a number on that is really tough."

 

Prior to the rains, farmers shifted some acres to rapeseed instead of wheat and other crops because of rapeseed's high prices, Ball said.

 

Rapeseed has attracted strong export demand as drought damaged South America's soy crops. The oilseed is mainly crushed to make vegetable oil for salad dressings, cooking spray and margarine.

 

Canada is the biggest exporter of rapeseed, spring wheat and oats.

 

ICE Canada November rapeseed futures shrugged off the big planting estimate and extended gains after the report, taking support from higher corn and soy prices.

 

Despite rains and storms this week that may have damaged some crops, most wheat is in fine shape, said John Duvenaud, analyst at Wild Oats Grain Market Advisory.

 

"It's a well-watered crop, an early crop, and it's looking fabulous," he said in a conference call on Statscan's report hosted by Minneapolis Grain Exchange.

 

The oat seeded area was 3.074 million acres, down from Statscan's previous estimate of 3.4 million acres. Statscan estimated durum area at 4.71 million acres, slightly below trade expectations and down from Statscan's previous forecast for 5.1 million acres.

 

The barley area was pegged at 7.365 million acres, below a range of trade expectations and Statscan's previous forecast of nearly eight million acres. Traders surveyed by Reuters, on average, expected rapeseed plantings of 20.9 million acres, an all-wheat area of 23.9 million acres, and 3.3 million acres of oats.