September Canola Crush Surges Higher
Statistics Canada reported 793,876 metric tons (mt) of canola were crushed in the month of September, the largest volume processed in 11 months but still below the 851,549 mt needed this month to reach the current Agriculture and Agri Food Canada estimate of 10 million metric tons (mmt) in 2022-23. This volume of crush is 2% higher than the same month in 2021 while 2.1% higher than the three-year average for September.
Over two months, the cumulative crush of 1.427 mmt is down .9% from the same period last crop year, with tight stocks carried into the 2022-23 crop year and a delayed harvest across the eastern Prairies contributing to a late start in activity. At the same time, crush margins remain historically high and Canadian dollar weakness is supporting an active crush.
The oil content achieved in the September crush rose from 41.3% in August to 41.7% in September, averaging 41.6% over the two months. This compares to the final crop year average reported in the 2021-22 crush of 41.8% and the three-year average of 43%. This can be expected to show improvement as we dig deeper into the 2022 crop, with the Canadian Grain Commission preliminary quality data pointing to a Western Canada average of 42.2% oil content for No. 1 Canada canola.
On Oct. 24, the Canadian Canola Crush Margin Index using January contracts was $229.58/mt, continuing to send a strong signal to crush. One year ago, this index was reported at minus $54.37/mt.
In September, 140,012 mt of soybeans were crushed, the lowest crush in three months and below the 158,333 mt needed this month to stay on track to reach the current 1.9 mmt AAFC forecast. This volume is 4.4% higher than the same month in 2021 while 7% higher than the three-year average for this month.
Cliff Jamieson can be reached at email@example.com
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