USDA Revises Canada's Canola Demand
Only modest revisions were made by the USDA's supply and demand tables for global rapeseed and canola this month. Global stocks were revised slightly lower to 4.051 million metric tons (mmt), or 5.8% of estimated use. USDA FAS tables show this is the tightest carryout seen in 18 years, or since 2003-04, when the stocks/use ratio was calculated at 5.6%.
The USDA did make changes to its forecasts for Canadian canola demand this month. The USDA reduced its forecast for Canadian canola exports by 600,000 metric tons (mt), to 5.7 mmt, which would be down 46% from the 2020-21 crop year and the lowest exports seen since the 2007-08 crop year. The USDA revised its forecast for domestic use higher by 700,000 mt to 8.667 mmt, down 19.3% from 2020-21 and the lowest since 2015-16. These revisions result in ending stocks revised lower this month by 100,000 mt, to 600,000 mt, close to the 500,000 mt forecast use by Agriculture and Agri-Food Canada.
Note that on Oct. 20, AAFC left its forecasts unchanged from the previous month, with exports forecast at 6.5 mmt and domestic use at 7.699 mmt.
Will domestic disappearance continue to grow at the expense of exports? Weekly statistics from the Canadian Grain Commission as of week 13 or Oct. 31, or the first quarter of the crop year, shows licensed exports of 1.5555 mmt, 69,500 mt behind the steady pace needed to reach the current 6.5 mmt demand forecast from AAFC. As well, the reported domestic disappearance volume is 460,550 mt ahead of the steady pace needed to reach the current AAFC forecast for domestic disappearance at 7.699 mmt.
Cliff Jamieson can be reached at firstname.lastname@example.org
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