Canada Markets

Canada's trade deficit with all nations fell from $3.1 billion in December to $1.9 billion in January, the smallest monthly deficit reported in three months. While exports fell 2.1% month-over-month, the country's imports fell 4.3%. Exports measured in dollars fell from December in seven of 11 sectors and at $45.8 billion is the lowest reported in three months, while 1.5% below January 2017. The dollar value of the Farm, fishing and intermediate food products category rose to $2.9818 billion in January, the highest monthly value reported in 12 months.

Here is a look at some of the export data released in today's report.

LENTILS

Lentil exports in January totaled 119,335 metric tons, up from December, but the smallest volume shipped in January in five years. Crop-year to-date, a volume covering the first half of the crop year (August-through-January), exports total 740,858 mt, a volume which represents 44.1% of the volume reported for the same period last year and 61% of the five-year average.

The current export target set by AAFC was revised 100,000 mt lower in February to 1.5 mmt, while current exports have reached 49.4% of this total over the first six months, suggesting movement may be on track to reach the target. At the same time, over the past five years, an average of 58% of total crop year exports have been realized in the first six months, a pace that would project to 1.3 mmt this crop year, which would indicate exports may fall short of the current target.

DRY PEAS

Dry pea exports were reported at 156,553 mt, the largest monthly volume shipped in three months but the smallest January movement seen in three years. Over these first six months, 1.44 mmt has been exported, 65% of the volume shipped in the same period in 2016/17 and roughly 85% of the five-year average for this period. AAFC's annual export target was increased by 100,000 mt in February, to 2.5 mmt, while cumulative movement covers 57.4% of this volume over the first half of the crop year. Over the last five crop years, an average of 56% of total crop-year exports have been achieved in the first six months, suggesting that the current pace is on track to reach this target.

CHICKPEAS

A reported 9,695 mt of chickpeas were exported in January, the smallest monthly movement seen in five months. At the same time, cumulative volumes of 98,495 mt is 75.8% higher than the same period last crop year and 146% higher than the five-year average.

Given the current 140,000 mt AAFC export target, current exports have achieved 70.4% of this target, well ahead of the pace needed to reach this volume. Over the past five years, an average of 43% of crop year exports were achieved in the first half of the crop year.

MUSTARD

Mustard exports were reported at 8,599 mt in January, up from the previous month. Cumulative exports of 54,849 mt are 96% of the same period last crop year and 90.5% of the five-year average for this period.

Given the current 120,000 mt target, cumulative exports have reached 45.7% of the annual target over the first half of this crop year. Over the past five years, an average of 48.9% of total crop year exports were realized, a pace that suggests current exports may slightly trail the pace needed to reach the target.

CANARY SEED

Canary seed exports were reported at 9,295 mt in January, down for a second straight month and the lowest monthly volume shipped this crop year. Cumulative shipments of 69,691 mt are 4.6% higher than the same period last crop year, but only 93.3% of the five-year average. AAFC's export forecasts was increased by 15,000 mt in February, to 150,000 mt, while cumulative shipments have reached 46.5% of this total over the first half of the crop year. Over the past five years, an average of 49% of total crop-year shipments are realized over this period, a pace only slightly ahead of the current pace.

FLAX

A reported 86,309 mt of flax was shipped in January, the largest monthly volume shipped this crop year, given a significant movement of 78% of the total volume to China. Cumulative shipments of 276,594 mt are 88.8% of the same period in 2016/17 and 94.2% of the five-year average. Given the current target of 500,000 mt of flaxseed exports for 2017/18, current movement accounts for 55.3% of this volume. Over the past five years, an average of 51% of total crop year exports are achieved over the first six months, which suggests the current pace is on track to reach or exceed the current target.

SOYBEANS

Canadian soybean exports totaled 350,236 mt in January, down for the second month and the lowest monthly volume shipped since September. This is also the lowest volume shipped in January in four years. September-through-January shipments are shown on the attached graphic. While the pattern of monthly deliveries is similar to what is see in recent years, what does stand out is the sharp decline in shipments to China this month, falling from 346,917 mt in December to only 1,357 mt in January, while listed as the 15th largest buyer this month after dominating Canada's shipments for many months.

Year-to-date (Sept-to-Jan), 3.4 million metric tons has been exported, 3.6% higher than the same period last crop year and 21.4% higher than the five-year average. Roughly 60.8% of the current 5.6 mmt target has been achieved in the first 42% of the crop year, a pace that lags recent years. Over the past five years, an average of 74% of total crop year shipments have been achieved in this five-month period, which projects to total crop year exports of 4.6 mmt, far short of the current 5.6 mmt target.

CANOLA

Canada's canola oil exports total 237,147 mt in January, down for a third straight month, while cumulative oil exports at 1.48 mmt are 1.6% below the volume shipped in the same period last crop year. Canola meal shipments were reported at 406,241 mt, down only slightly from last month's high, while year-to-date shipments are 4.2% below the same period last crop year.

CORN

At 55,172 mt, Canada's January corn exports were the lowest volume shipped in three months and the lowest monthly volume shipped in January in three years. Crop-year exports are 501,486 mt, 26.8% higher than the same period last crop year and 40.4% higher than the five-year average. AAFC's export forecast has been increased by 250,000 mt in the February tables to 1,750,000 mt, while cumulative exports represent just 28.7% of this target. Over the past five years, an average of 28.5% of crop year shipments were achieved over this five-year period, indicating that the current pace of exports is in line with past movement and should achieve current targets.

**

DTN 360 Poll

This week's poll points to the International Energy Agency forecasting that Canada's oil-by-rail movement will double from historical highs over the next two years, and asks if the agriculture industry should be concerned. You can weigh in with your thoughts on this poll found at the lower right side of the DTN Canada Home Page.

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

Follow Cliff Jamieson on Twitter @CliffJamieson

(ES/)

© Copyright 2018 DTN/The Progressive Farmer. All rights reserved.