Canada Markets

There were few changes in the April Agriculture and Agri-Food Canada supply and demand estimates released this week, as found in the Canada: Outlook for Principal Field Crops.

The largest change was a reduction in the forecast for Canadian barley exports. As seen by the divergence of the blue line (forecast exports) and the brown line (forecast domestic feed use) on the attached chart, exports were revised 350,000 metric tons lower to 2.6 million metric tons, while domestic feed use was revised higher by the same volume, leaving the forecast for ending stocks unchanged at a record-low 300,000 mt. This is the first drop in the export demand estimate seen this crop year, or since August.

Forecasting the barley supply situation will be challenging as we move forward with stocks forecast to move towards zero. The next official signal due from Statistics Canada is the March 31 stocks estimates, due for release on May 6.

What we do know is that exports have slowed considerably, due largely to lower demand from China. Statistics Canada data shows barley exports reaching a high of 611,309 mt in October, of which 97.2% was destined for China, while this volume fell to 69,263 mt in January and rebounded only slightly to 95,711 mt in February, of which 87% was destined for China.

Official data as of February shows 1.613 mmt exported during seven months of this crop year, still approximately 1 mmt below this month's government forecast of 2.6 mmt, although this demand forecast includes product exports.

Weekly Canadian Grain Commission data shows commercial stocks as of week 36 or the week ending April 10 at 329,400 mt, which is down from 600,700 mt reported for the same week last crop year, while is the lowest commercial stocks reported for this week since the 2016-17 crop year, or five-years.

AAFC's feed use has been revised higher this month to 4.41 mmt, the highest estimate shown in four months while down 2 mmt from the previous crop year. Feed usage of barley and wheat combined is estimated down 2.341 mmt from the previous crop year, offset by an equal volume increase in corn imports.

USDA export data for the week ending April 14 shows 35,500 mt of corn exported to Canada, the lowest weekly volume reported since last fall. This compares to 120,900 mt exported in the week prior and the four-week average of 98,200 mt. Total U.S. exports to Canada plus open sales equals 3.6562 mmt, which remains short of AAFC's 4 mmt forecast for the 2021-22 crop year and bears watching.

Cliff Jamieson can be reached at cliff.jamieson@dtn.com

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