Canada Markets

If you follow the USDA's monthly global canola and rapeseed data you can't help to notice the wild swings in data, as seen in the Oilseeds: World Markets and Trade report. A good example is seen with the 2019-20 ending stocks estimates, which have been released since May 2019. The attached chart shows the crop year's global stocks estimated moving from 9.232 million metric tons in June, to 6.715 mmt in July, back to 8.704 mmt in August and back to 6.563 mmt in September.

What is also noticeable in the February data is that the global production estimate was increased for the first time in eight months to 67.749 mmt from the January estimate, while the estimate for global use also increased for the first time in eight months to 69.327 mmt. While production was increased by 25,000 metric tons from January's estimate, global use was increased by 207,000 mt, while global ending stocks were estimated 294,000 mt lower this month at 6.485 mmt, or 9.4% of global use.

This reflects the lowest stocks in three years, while down from the highest estimate of 9.232 mmt reported in June 2019. Since then, global production has been estimated 7.052 mmt lower, while global use has fallen only 3.056 mmt, or just 43% of the drop in estimated production.

As with Statistics Canada production estimates, the USDA's production estimates may be overstated as a result of 1 million to 2 million acres of canola yet to be harvested in Western Canada and the challenges that may lie ahead. USDA estimates may only be a few months away from reflecting an even larger bullish situation for the crop when global estimates are taken into account.

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Cliff Jamieson can be reached at cliff.jamieson@dtn.com

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