Canada Markets

Canada's increased canola production in 2022 has led to a surge in movement to China, as seen in the Canadian Grain Commission's Exports of Canadian Grain and Wheat Flour report for October.

Exports to China were reported at 624,700 metric tons (mt) for the month, up from 125,000 mt shipped over the first two months of the crop year, or the months of August and September.

Cumulative exports to China are reported at 749,700 mt as of October or the first quarter of the crop year, up 107% from the same period in 2021-22 and the largest year-over-year percentage change seen for this period in six years, or from 2016-17 to 2017-18. As seen with the blue bars on the attached chart, this is the largest volume shipped to China in four years, while is 4.6% higher than the five-year average for this period.

As a percentage of total exports reported by the CGC, this volume represents 46% of the total volume shipped over the three months, which is the highest percentage calculated over this period in eight years. This calculation is also seen at 46% for the first three months of the 2014-15 crop year.

It is interesting to contrast this data with the CGC's wheat export data. The larger wheat crop has allowed exporters to target more countries with wheat sales, with cumulative data showing wheat exports (excluding durum) to 43 countries over the first three months of 2022-23, up from 32 countries reported as of October 2021. Wheat exports to China have also risen by 812,300 mt or 332% year over year to 1.0568 million metric tons (mmt), while the list of countries targeted has also grown by 11.

The list of countries showing canola exports over the first three months increasing by one from one year ago at 10 countries, while key markets such as Japan and Mexico are showing a year-over-year drop in exports.

Over the past five years, exports to China in the first quarter of the crop year represent an average of 26.5% of total crop year exports to China. This percentage ranges from 19.6% in 2019-20 to 34.2% in 2018-19.

Over the past week, the Canadian crop size has been revised lower, while the Australian crop has been revised larger.

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

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