Canada Markets

Saskatchewan Agriculture released a comprehensive look at the expected grades across a number of crops along with this week's Crop Report, while comparing 2014 to the 10-year average from 2004 to 2013. The province gives credit to 229 crop reporters who provide data from across the province in its weekly Crop Report.

As seen on the attached chart, the largest grade-related issues faced by producers and end-users will be in the durum, lentil and malt barley markets.

The Saskatchewan government sees 51% of the spring wheat crop falling into the top two grades, down from the 10-year average of 70%. This is sharply lower than the government's 2013 report which estimated 89% of the crop falling into the top two grades. Grade results for CWRS are consistent within the trade, with the Grain Commission's Nov. 4 report indicating 47% of the samples graded to date from Saskatchewan falling into the top two grades, while the CWB recently reported this figure at 50%.

Reported grades for durum will pose changes for the supply chain for the balance of the crop year. Saskatchewan Agriculture reports that only 15% of the durum has achieved the top two grades, which is well below the 10-year average of 66%. This comes after last year's crop also fell below average, with 55% of the crop reported by the government to reach the top two grades, which at the time was below the 10-year average of 70%.

As of the Nov. 4 report, the Canadian Grain Commission's reporting indicated that only 11.5% of Saskatchewan samples have reached the top two grades, while the CWB recently reported that 23% of the crop would reach a 1 CWAD or 2 CWAD.

Saskatchewan Agriculture reported that 19% of the barley crop will achieve malt quality. This is well below the 10-year average acceptance of 34%. One year ago, Saskatchewan Agriculture reported that 36% of the 2013 crop had achieved malt quality, at that time 2% above the previous 10-year average.

Prairie lentil quality has received recent attention. Saskatchewan Ag reported the percentage of the lentil crop reaching the top two grades at 37%. This is well below the 10-year average of 75%, and even further below the 89% reported by the provincial government this time last year for the 2013 crop.

The controversy exists with the Canadian Grain Commission's data as of Oct. 27 which suggests that 65.8% of the samples received are falling into the top two grades. Meanwhile, processors are suggesting that both the CGC and the government are off in their estimates and the true number could be below 30%. This is a situation that bears watching.

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

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