According to Agriculture and Agri-Food Canada's June Outlook for Principal Field Crop report, ending stocks for all principal field crops is expected to fall just 248,000 metric tons in 2018-19 from the previous crop year to 15.172 million metric tons.
This is comprised of a modest drop in total grains and oilseed stocks of 45,000 mt, and a 203,000-mt drop in stocks of pulses and special crops, with the largest drop in stocks forecast for dry peas.
The same forecast points to a year-over-year increase in stocks of all principal field crops from 2018-19 to 2019-20 of 1.9 mmt, down from the 2.9-mmt increase forecast last month. The largest changes reported this month are a 1-mmt increase in 2019-20 canola exports forecast for 2019-20 to 9 mmt, just slightly below this year's forecast of 9.3 mmt, while leading to a forecast 4.3-mmt carryout for 2019-20 that is 400,000 mt higher than the current crop year. This could be viewed as one of the largest wildcards moving forward as the industry and politicians focus on restoring relations with China.
Other changes this month include a 200,000-mt upward revision in exports of both wheat and durum for 2018-19, which result in an equivalent drop in stocks for 2018-19 to 3.7 mmt and 1.7 mmt, respectively, along with a lower carry-in for 2019-20.
The attached chart shows the four major crops that are expected to result in a year-over-year increase in stocks from the 2018-19 crop year to the 2019-20 crop year. Stocks of canola are forecast to rise for a second straight year (400,000 mt), stocks of barley (550,000 mt) and wheat (1.7 mmt) are forecast to rise for the first time in three years, and stocks of dry peas are also forecast higher (100,000 mt), with the year-over-year change shown in brackets.
While demand was tweaked this month, no changes were made to yield potential for the 2019 crop despite the challenging start the crop has faced due to drought across the Prairies. On June 26, Statistics Canada will update its seeded acreage report, while the first look at production potential will be released later in the summer.
Of the four crops shown on the attached chart, a 3.9-bushel-per-acre drop in forecast barley production, a 0.8-bpa drop in canola yield, a 0.9-bpa drop in pea yield and a 3.1-bpa drop in wheat yield would be required -- relative to current estimates -- before stocks of these four crops would show a decline in stocks year-over-year, leaving seeded acreage estimates and demand estimates unchanged.
Cliff Jamieson can be reached at email@example.com
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