Wet Spring Prevents Record Canadian Canola Planting

Canadian prairie farmers had been planning to plant large areas to canola (rapeseed) this season; however, continuous rainfall through the end of the planting window limited their opportunities. With its March planting intentions report, Statistics Canada forecast that farmers would plant a record 6.8 million hectares. When Statistics Canada carried out their farm survey from May 25 to June 3 for the Preliminary Estimates of Field Crops Areas report, enthusiasm for the crop had increased and the forecast area increased to 7.2 million hectares. By June 20, however, the planting window was closed and many farmers, especially in northeast Saskatchewan where much of the canola is typically grown, had been unable to sow. Using reports from provincial sources on percent planted, International Production Assessment Division/FAS/USDA estimates Canada’s canola planted area to be 5.8 million hectares, just 80 percent of Stats Canada’s June estimate.

Canada’s canola area has increased the last several years. Harvested area averaged 4.81 million hectares from 1997 to 2006, but averaged 6.28 million in the last three years. With the widespread adoption of hybrid canola seed, Canada’s yield increased from 1.41 tons per hectare (from 1995 to 2004) to 1.80 tons (from 2005 to 2009). With sizeable increases in area and yield, canola production has surged from an average 6.55 million tons (between 1995 and 2004) to an average 10.51 million (from 2005 to 2009).

The crop will go through the - critical for determining yield - reproductive stage of development in late July and early August with harvest occurring in September and October. Taking a normal seeded to harvested ratio of 99 percent, 2010/11 harvested area was forecast in FAS’s World Agricultural Production at 5.75 million hectares. Planting and field operations were difficult this spring, but soil moisture is plentiful and yields are forecast near trend at 1.77 tons per hectare. Production is forecast at 10.2 million tons, down from 11.8 million last year. Agriculture and Agri-Foods Canada (Canada’s Ministry of Agriculture) released its latest estimate of canola production on July 8 at 10.5 million tons, slightly above the USDA forecast.

Though bulk commodity prices generally have declined from the high levels of 2008, prices for canola were seen as attractive this year. Near-by canola futures on the Winnipeg Commodity Exchange held fairly steady, down 2 percent from January to May 2010, while Pool Return Outlook prices for wheat declined 12 percent.

Elsewhere in the world, a dry spell in northern France in late June and early July lowered expectations for the European Union 2010/11 crop. USDA’s estimate of European Union rapeseed production was lowered this month by 2 percent to 20.6 million tons. The United States is a small producer, but according to USDA’s July World Agricultural Supply and Demand Estimates, area in the U.S. is forecast up 81 percent and production is up 48 percent from last year. Output is projected at 0.99 million tons. World output of rapeseed in 2010/11 is forecast at 57.8 million tons. This is the third largest harvest ever, but it is down 4 percent from last year’s record crop.

Current USDA area and production estimates for grains and other agricultural commodities are available on IPAD's Agricultural Production page or at PSD Online.