May 27, 2009

With time quickly running out for producers in western Canada to plant a crop, there were ideas that the area seeded to canola may be a bit higher than what Statistics Canada had forecast.

 

Barley area, meanwhile, was expected to be down while wheat area was seen holding about steady.

 

"Favourable returns per acre, the higher yield potential and the fact that new varieties of canola have a shorter growing season were expected to have bolstered the area that will be planted to canola," said Jerry Klassen, a wheat trader and market analyst.

 

He forecast 2009 canola area in Canada at 16.300 million acres, which would compare with the acreage survey released by Statistics Canada on April 24 that pegged canola area at 14.989 million versus the year-ago level of 16.159 million.

 

"While farmers may be pushing canola rotations, the fact that it is a cash crop that can pay bills is attracting acreage," Klassen said.

 

Mike Jubinville, an analyst with ProFarmer Canada, agreed canola seeded area probably increased significantly from the StatsCan survey report released in April.

 

However, whether the increase was 500,000, 700,000 or even a million acres higher, it is still anyone's guess, Jubinville said.

 

There had been ideas that producers in parts of eastern Saskatchewan and Manitoba would give increased consideration to planting barley given the lateness of the growing season.

 

However, the fact that barley in Manitoba is prone to diseases, such as rust, and there are few cash-market delivery opportunities other than to the Canadian Wheat Board, the area to the crop will likely be down, not up, said Bill Craddock, an independent trader and a Manitoba-based producer.

 

Klassen forecast barley area in Canada to be down at 8.900 million acres. This would compare with the April StatsCan survey calling for barley area to be in the 9.476-million-acre range versus the 2008 level of 9.357 million.

 

"There is a significant difference for barley," Klassen said. "The returns per acre are significantly below other crops, which should discourage acreage."

 

Jubinville and Craddock indicated that producers in Manitoba would be more willing to take a chance on seeding wheat.

 

Klassen forecast all-wheat area in Canada to come in at 25.085 million acres. This would compare with the StatsCan April forecast of 25.161 million acres and the 2008 level of 25.010 million.

 

Of the all-wheat projection, Klassen expected that producers would seed 5.910 million acres to durum. This compares with the April estimate of 5.730 million acres and the 2008 level of 6.030 million.

 

Statistics Canada will release an updated 2009 acreage outlook on June 23.