Canadian officials lifted expectations for domestic prices of major crops as they lifted their forecast for the country’s wheat exports this season and flagged support for values from a firm US corn market.
AAFC, Canada’s agriculture ministry, nudged higher by Can$5 per tonne to $405 per tonne its forecast for domestic wheat prices, as measured by Saskatchewan values, in 2022-23, while making bigger upgrades to expectations for values in the likes of barley, canola and oats.
The revisions, which followed a run of three successive months of price forecast cuts, came as the ministry lifted by 100,000 tonnes to 18.30m tonnes its forecast for Canada’s wheat exports for the season, on an August-to-July basis.
Exports at that level would be 47% higher year on year, AAFC said, saying that the upgrade reflected “decreased supply from competitors”.
Many commentators – including the US Department of Agriculture, whose data set global benchmarks – see wheat stocks held by major exporters dwindling this season to their lowest in a decade, although Canada’s are seen recovering somewhat after a strong 2022 harvest.
Canada’s exports of wheat, excluding durum, for 2022-23 up to mid-October had reached 3.67m tonnes, growth of 25% year on year, according to the Canadian Grains Commission.
AAFC listed China, US, Japan and Bangladesh among top early-season buyers.
‘High corn prices’
Among coarse grains, AAFC lifted its expectations for average 2022-23 oat prices, as measured by Chicago futures, by Can$25 per tonne to Can$365 per tonne, saying values would be “supported by strong prices” in other feed grain markets.
These include corn, for which the ministry forecast “strong demand and high new crop corn prices in the US”.
Chicago corn futures on Monday stood at $6.79 a bushel, down by 0.8% on the day, but still at historically elevated levels.
For barley, AAFC lifted its forecast for Canadian prices this season, as measured by values for feed grain in Lethbridge, Albert, by Can$30 per tonne to Can$400 per tonne.
While down from the record Can$432 per tonne achieved last season, the barley price “will remain historically high, largely underpinned by strong corn prices and robust demand”.
Canola price upgrade
For canola, the forecast for average 2022-23 prices, as measured in Vancouver, was raised by Can$35 per tonne to Can$880 per tonne
“If realised, this would be the second highest canola price on record,” AAFC said. The all-time high of Can$1,075 per tonne was set last season.
While not making any changes to its Canadian canola balance sheet estimates for this season, the ministry did lift its forecast for exports of rival oilseed soybeans, by 100,000 tonnes to 4.40m tonnes.
“Exports are forecast to increase by 10% [year on year]… with shipments headed to a diverse assembly of countries,” the ministry said.