Canada Markets

Statistics Canada reported 875,315 metric tons (mt) of canola crushed in January, with above-seasonal temperatures seen across most of the Prairies for the month, along with significant supportive factors providing incentive to crush. Agriculture and Agri-Food Canada's agroclimate maps show the mean temperature difference from normal ranging from 0 to 2 C above normal in the southeast Prairies to as high as 5 C above normal in the Peace Region of Alberta.

The January crush is 34.4% higher than the same month in 2021-22 and 8.4% higher than the three-year average for this month. It was also close to 100,000 mt higher than the volume needed this month in order to stay on track to reach AAFC's crush forecast of 9.5 million metric tons (mmt).

Over six months of this crop year, a reported 4.891 mmt has been crushed, up 9.8% from the same period last crop year while .9% below the three-year average. Note that in 2020-21, the monthly crush exceeded 900,000 mt in four of the first six months of the crop year, and six of the 12 months of the crop year. The monthly crush in 2022-23 has reached a high of 885,331 mt in October.

The brown line on the chart represents the volume needed each month to reach the current AAFC forecast, with the monthly crush (blue bar) exceeding the volume needed (brown line) for four consecutive months. AAFC held their crush forecast steady at 9.5 mmt in their February report, unchanged since this forecast was reduced from 10 mmt to 9.5 mmt in December.

A ProphetX chart approximating the move in the Canadian Canola Board Margin Index shows a mean index of $218/mt in the month of January, up slightly from the $213.84/mt calculated for December, while remains significantly higher than the minus $78.16/mt calculated for January 2022.

Statistics Canada data shows the oil content reached in the January crush was 41.6%, down .2 percentage points from the previous month. The August-January oil content is calculated at an average of 41.5%, down slightly from 41.8% final average achieved in 2021-22 and the five-year average of 43.4%.

Statistics Canada also reported that 163,578 mt of soybeans was crushed in January, only slightly higher than the previous month and the volume crushed in January 2022.

Over the first five months of 2022-23 (Sept-Jan), 789,404 mt has been crushed, up 1.5% from the same period in 2021-22 and is 4.4% higher than the three-year average for this period. This marks the fastest pace of crush seen in four years.

AAFC has currently forecast the 2022-23 crush at 1.9 mmt, while the current pace of crush is slightly behind the steady pace needed to reach this forecast.

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

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