Canada Markets

Canada's total grain stocks in licensed facilities in week 42 or the week ending May 22 increased by 40,700 metric tons to 6.2242 million metric tons. Despite the sharply reduced crop production due to the prairie drought in 2021, this volume is up 12.6% from the same week in 2020-21 and 17.7% higher than the three-year average for this week. This represents the first week-over-week increase in stocks in five weeks.

It is interesting to note that week 42 commercial stocks of both wheat and durum are above the same week in 2020-21 as well as the three-year average, while stocks of canola are higher than average for this week.

The volume held in storage can represent a variety of factors, including the ability to source based on availability, along with the incentive to hold grain based on market signals and sales opportunities.

Where the stocks are held is also of interest. In the case of wheat (excluding durum), 42% of the week 42 volume is situated at a terminal position which is below the three-year average of 51.3%. A reported 53% of the week 42 stocks of durum are found situated in a terminal position, close to the three-year average of 57%. Only 24% of the canola stocks are found in an export terminal, down from the three-year average of 37%.

This calculation will be affected by factors such as rail performance, although will also be heavily influenced by domestic demand, such as the commercial trade holding canola on the Prairies to meet crush demand over the weeks ahead.

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

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