This study considers the seasonality of exports, making projections for 2019-20 based on the five-year average pace of licensed exports as of week 10, which may shed light on the current pace of exports relative to the historical pace but also against Agriculture and Agri-Food Canada's most recent forecasts for 2019-20.
Canada's week 10 wheat cumulative exports, which covers activity through the week ending Oct. 13, are reported at 3.0858 million metric tons, a volume that is down 14.8% from the same period in 2018-19 and 5.3% below the five-year average. This may be explained due to the late harvest seen in Western Canada, the effects on quality and exporters taking a cautious approach to trade.
The black line on the chart, measured against the secondary vertical axis, indicates that on average during the past five years, 18.3% of total crop year exports were achieved as of week 10 CGC statistics, an average pace that projects forward to crop year exports of approximately 16.9 mmt, well below the 19.763 mmt shipped in 2018-19 and AAFC's forecast of 19 mmt.
Cumulative exports of durum are reported at 920,700 metric tons as of week 10, up 57.1% from the same period in 2018-19 and 41% higher than the five-year average for week 10. This is the fastest pace of movement seen since 2014-15 when 977,700 mt was shipped in the same period and a clear indication of early buying interest and concern over supplies of quality durum. Over the past five years, an average of 14% of total crop-year exports were shipped as of week 10, while this pace projects forward to 6.6 mmt of exports this crop year, which compares to the 4.526 mmt shipped in 2018-19 and AAFC's forecast of 4.7 mmt. A lack of supplies, compounded by a further lack of quality supplies, will make this projection impossible to reach.
The current pace of exports of oats and barley is well behind the 2018-19 crop year but well ahead of the five-year average as of week 10. Projections for 2019-20 based on the five-year average pace of movement are close to both 2018-19 volumes and current government forecasts, as seen on the attached chart. While week 10 represents the first 19.2% of the crop year, data from the past five years shows the Canadian Grain Commission's week 10 export volumes accounting for just 12.4% of total crop year exports of oats and 6.4% of the total crop-year exports of barley.
Flax exports are clearly off to a slow start. As of week 10, 8,300 mt has been shipped through licensed terminals, down 82.2% from 2018-19 and 77.4% below the five-year average pace. Tight carryout stocks for 2018-19 combined with a delayed harvest are partially behind this, with Saskatchewan Agriculture estimating 24% of the province's crop harvested, as of Oct. 14, which compares to both the three-year and five-year average which is close to 60% complete. This week's Manitoba Crop Report estimated the flax harvest at 45% complete, below the three-year average of 88%. The current pace of exports projects forward to a crop-year total of 118,260 mt, well below the current AAFC forecast of 500,000 mt and the 465,900 mt shipped in 2018-19.
Canada's canola exports as of week 10 are 1.9% higher than the same week in 2018-19 at 1.527 mmt, while 7.8% below the five-year average of 1.656 mmt for this week. Over the past five-years, an average of 16.5% of total crop year exports were shipped as of week 10 CGC data, a pace that projects forward to crop year exports of 9.230 mmt, in-line with the 9.2 mmt forecast released by AAFC and the 9.141 mmt shipped in 2018-19. Any signal of increased buying by China would quickly alter the outlook for this market.
As of week 10, 736,500 mt of dry peas have been shipped, up 70.9% from the same period in 2018-19 but at the same time, 13.9% below the five-year average for this 10-week period. Over the past five-years, pea exports have been front-loaded in the crop year, with an average of 27% of crop year exports realized as of week 10 licensed exports. This does vary widely, with just 13.3% of crop year exports realized as of this week in 2018-19 while 35.5% of crop year exports were achieved as of this week in 2015-16. The five-year average pace of movement projects forward to 2.7 mmt of exports in 2019-20, trailing the 3.247 mmt shipped in 2018-19 and AAFC's forecast of 3.4 mmt.
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Cliff Jamieson can be reached at email@example.com
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