NEW DELHI, Sept 25 (Commoditiescontrol) - Canada's 2021-22 canola production may fall to a 13-year low at 12.8 million tonnes (Mt), down 34.40 percent from 19.5 million tonnes in 2020-21, according to AAFC’s latest outlook report, published on September 24.
For 2020-21, Canada crushed a record 10.4 Mt of canola compared to the 10.1 Mt processed the previous year and the 5 year average of 9.2 Mt. Canadian exports of canola were the 3rd highest on record at 10.5 Mt, versus the 10.0 Mt shipped out of the country a year ago and the 5 year average of 10.3 Mt. Ending stocks were 1.8 Mt for a stocks-to-use ratio of 8% compared to 3.4 Mt and 16%, respectively, a year ago. The modern day low carry-out was 0.59 Mt in 2012-13 while the record high carry-out occurred in 2018-19 at 4.4 Mt. For the crop year, the simple average price track Vancouver was $730/t, versus $484/t for 2019-20 and the 5 year average of $556/t.
For 2021-22, production is estimated at a 13 year low of 12.8 Mt on a seeded and harvested area of 9.1 Mha and 9.0 Mha respectively. Yields at 1.4 t/ha are the lowest since 2003-04 and are 39% below last year and the 5 year average, respectively. By province, Manitoba canola production is estimated at 2.5 Mt, Saskatchewan 5.8 Mt and Alberta 4.3 Mt. Canadian supplies are estimated at 14.7 Mt, the lowest since the 2008-09 crop year, on a combination of tight carry-in stocks, reduced output and modest imports. Canola supplies were 23.0 Mt in 2020-21 and the 5 year average is 23.1 Mt.
Canadian exports are forecast to fall 38% from last year to 6.5 Mt on tight Canadian supplies and strong world demand. Similarly, domestic crush is forecast to decline from last year’s record of 10.4 Mt to 7.5 Mt as supplies are rationed among users. Ending stocks are forecast to tighten to 0.50 Mt, with 0.3 Mt in commercial position and 0.2 Mt stored on farm, for a stocks to use ratio of 4%. Tight canola stocks combined with strong US soyoil prices are forecast to support a canola price of $940/t for 2021-22, compared to $730/t in 2020-21 and the 5 year average of $556/t.
This outlook contains a significantly higher-than normal degree of uncertainty given the expansion in world vegetable oil consumption and the adverse growing conditions across different growing regions over the past year. Volatility for canola prices is expected to remain high over the next several months with the market remaining vulnerable to a sharp correction from either a demand or supply shock.
(By Commoditiescontrol Bureau)
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