According to Agriculture and Agri-Food Canada's latest supply and demand tables, Canada's durum fundamentals for the 2020-21 crop year are close to a carbon copy of 2019-20. Despite a forecast 23.2% surge in production year-over-year to 6.134 million metric tons, crop-year supplies are forecast close to unchanged from the previous crop year at 6.844 mmt due to a lower carry-in of only 660,000 metric tons.
In addition, exports, domestic use and carry-out stocks for 2020-21 are close to volumes estimated for 2019-20, while the forecast average price received by producers is left unchanged at $270/mt.
These forecasts should be viewed as a work in progress and will face revisions, but this week's data shows that the durum harvest is close to complete, producer deliveries have been high, commercial stocks are high, exports are off to a slow start and yet pdqinfo.ca is showing a modest recovery in prices.
As of the CGC's week 7 data, producers have delivered 655,700 mt of durum into the licensed handling system, up 27% from the same period in 2019-20 and 38.5% higher than the five-year average. Commercial stocks reported for week 7 are shown at 817,400 mt, up 46.5% from last crop year and 25.4% higher than the five-year average. Of this volume 278,100 mt is in-store Thunder Bay/St. Lawrence export terminals, which compares to 161,200 mt this time last year.
Growing commercial stocks are tied to an earlier harvest and a slower start to exports. As of week 7, cumulative exports through licensed facilities are at 354,000 mt, down 45.4% from 2018-19 and 16.3% below the five-year average for this week.
Just one piece of this puzzle is improving demand into Europe, specifically Italy. European Union weekly data shows EU durum imports at 673,214 mt as of its week 13 (beginning July 1), up from 362,832 mt shipped in the same period of 2019-20 and 151,054 mt in 2018-19. Of this volume, Canada has supplied 483,467 mt, or 71.8%, of the total, a volume that is up 130.7% year-over-year.
As of Aug. 28 price data, pdq's southern Alberta bid has bounced $9.61 from its Aug. 28 low to $280.15/mt, the southeast Saskatchewan bid has bounced $10.59 from its Sept. 16 low to $277.67/mt and southwest Saskatchewan has increased by $12.23/mt from its Aug. 28 low to $277.18/mt. These values exceed the crop year average of $270/mt forecast by AAFC in September and this move bears watching.
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