Canada Markets

The attached chart shows weekly export volumes for Canada's all-wheat (including durum) through licensed facilities, as indicated by the blue and green bars which are measured in metric tons against the secondary vertical axis on the right.

The red line indicates the cumulative 2015/16 exports as a percentage of 2014/15 volumes. As of week 5, cumulative exports in 2015/16 had slipped to a low of 69.8% of the cumulative volume shipped in the previous year, while in week 28 (or the week ending Feb. 14, Canada's all-wheat exports were 100.1% of the 2014/15 volume. This was the first time this crop year that cumulative exports had surpassed the previous year's volumes.

Week 29 data saw this value slip slightly to 99.5% of year-ago volumes, but the point is that current-year activity is closely tracking last year's shipments. This becomes even more significant when one considers that the current export forecast for 2015/16 in the U.S. would indicate the lowest volumes shipped since 1972/73, while most recent U.S. data shows current sales being 17% below last year and well-below the 9% drop estimated by the USDA, suggesting that further reductions in sales potential may be expected.

The black line on the chart refers to the current Agriculture and Agri-Food Canada forecast for all-wheat exports in 2016 as a percentage of actual exports in 2014/15. The most recent February supply and demand tables suggest shipments will reach 21.9 million metric tons in 2015/16, which is only 91.5% of the 23.940 mmt actual exports in the year prior.

The question is -- will exports be able to maintain the current pace? Over the first 29 weeks of 2015/16, licensed terminal shipments of wheat and durum combined are 19% ahead of the five-year average.

With week 29 data representing the first 55.8% of the crop year, over the last five years (2010/11 through 2014/15), an average of 53.6% of the year's total licensed exports were shipped as of this week. Should movement over the balance of the crop year slow to a level which is reflective of the five-year average, the current cumulative volume shipped of 11.8747 mmt could be extrapolated to total 22.154 mmt over the crop year. This is slightly higher than the government's forecast and 7.5% below the previous year.

**

DTN 360 Poll

This week's poll asks what you feel will be the biggest story in 2016 with regards to year-over-year reductions in acreage of various Canadian crops. You can weigh in with your thoughts on DTN's 360 Poll which is found at the lower-right corner of your DTN Home Page. Thanks for your support!

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

Follow Cliff Jamieson on Twitter @CliffJamieson

(ES)

© Copyright 2016 DTN/The Progressive Farmer. All rights reserved.