Canada Markets

Sask Harvest Similar to 2009; Ag Sentiment Wanes

Cliff Jamieson
By  Cliff Jamieson , Canadian Grains Analyst
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The Saskatchewan harvest remains flat-lined for the third consecutive week with 82% of the crop estimated to be harvested (blue line), with the trend sharing some similarities to the situation faced in 2009 (red line). The 2011 through 2015 average is shown in green. (DTN graphic by Nick Scalise)

As seen on the accompanying chart, the October trend for pace of the Saskatchewan harvest in 2016 (blue line) shares a resemblance to the challenges faced in 2009 (red line). As of October 24, 82% of the crop is estimated to have been combined, up just 2% from the 80% reported on October 3. In 2009, the month of October also dealt a difficult hand with the harvest progress advancing from an estimated 76% in early October to just 79% by the end of the month.

The November 2, 2009, crop report showed producers dealing with wet fields as well as tough and damp grain, while waiting for freezing temperatures in order to facilitate movement on both roads and fields, while the November 24 report showed the harvest completed. The final crop report for 2009 estimated that grades were near or slightly higher than the previous 10-year average. One major difference between the two years is the excessive moisture seen during the growing season and during the fall months of 2016. AAFC's Percent of Average Precipitation for the Prairie Region shows roughly half of the province's growing area receiving in excess of 200% of normal moisture between September 1 and October 25, while the balance of the growing area was largely 150 to 200% of average.

Challenges faced by Canada's farmers, including the delayed harvest activity on the Prairies, are seen to weigh on business sentiment, according to the Canadian Federation of Independent Business (CFIB) monthly Business Barometer.

The CFIB's monthly look at business sentiment shows Canada's overall index of all industries at 57.7, down for a second consecutive month. The CFIB describes their index as ranging from 0 to 100, with values above 50 pointing to business owners who feel business performance over the next year to be stronger out-numbering the number of those who expect weaker performance. The CFIB view an index ranging from 65 and 70 points to an economy growing at potential.

The agriculture index was reported at 47 in October, down 5.9 from September, and is the lowest of the 13 business sectors reported. So far this calendar year, this index has been reported below 50 in five of the 10 months reported (February, March, April, August and October). This is the weakest data seen since 2009 when this index ranged between a low of 41.9 and a high of 49.3 in the nine months of January through September.

Of the 13 business sectors reported, the Agriculture Index joins only Transportation as the sectors recording and index below 50.

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