Given the Canadian Grain Commission's week 13 statistics, which covers the first 25% of the 2017/18 crop year, today's blog makes projections for crop year exports of selected grains based on the week 13 five-year average cumulative exports calculated as a percentage of total crop year exports.
This may provide insight as to where current exports are on track relative to current government estimates, where they are behind the pace needed to meet current estimates, or well ahead of the pace needed to achieve current estimates, which could lead to upward revisions in export forecasts and tighter-than-expected ending stocks.
For example, over the past five years (2012/13 to 2016/17) an average of 23.6% of crop year exports of wheat have taken place in the first 13 weeks of the crop year. This can be extrapolated to project exports of 16.187 million metric tons for the current crop year, which is very much in line with Agriculture and Agri-Food Canada's most recent October estimate of 16.3 mmt of total wheat exports (excluding durum).
Of the selected crops, the projected 2017/18 wheat exports is closest of the crops shown to the current government estimates, with the current projection only .7% lower than the AAFC forecast. Other crops whose export projections are relatively close to their respective AAFC targets are durum (minus 3.8%), canola (minus 6.2%) and dry peas (minus 9.5%), with the percent change from AAFC forecasts in brackets.
Three crops of those selected that have jumped to a quick start in the crop year in terms of exports are oats, barley and flax based on week 13 cumulative shipments. Over the past five years, a relatively low 14.2% of the crop year oat exports, 8.4% of the barley and 7.2% of the flax have been completed as of week 13. This information is used to project crop year exports that leads to a projection for oats of 3.2 mmt, 35% higher than the current estimate. Barley exports are projected at 4.6 mmt, or 116% higher than the current estimate, while flax exports are projected at 724,000 mt or 44.8% higher than the current AAFC estimate.
While exports for these three grains may come nowhere close to these projections, this study does indicate movement that is well-ahead of the average pace. Only time will tell if this pace can continue that could be supportive for prices over time.
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Cliff Jamieson can be reached at email@example.com
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