Canada Markets

Canadian exports and imports of merchandise fell in February, with total exports down 2.4% and imports down 1.3%. Canada's merchandise trade surplus fell for a second month from $1.2 billion to $422 million in February.

Statistics Canada commentary points to a sharp drop in total exports to countries outside of the United States, while the miscellaneous changes in activity during the month include a drop in reported wheat shipped to Iraq while commentary points to an increase in agricultural products shipped to China.

February saw 174,003 metric tons (mt) of lentils shipped, up from the previous month. Measured in dollars, Turkey was the largest destination for Canadian lentils in February, with 59% of the sales shipped to this country. The cumulative volume is seen at 1.396 million metric tons (mmt), up 61.3% from a year ago and 24.6% higher than the five-year average. To-date, exports have reached 60.7% of the current Agriculture and Agri-Food Canada (AAFC) forecast for 2022-23, slightly ahead of the steady pace needed to reach the current export forecast of 2.3 mmt.

Statistics Canada reported dry pea exports at 284,378 mt, the highest volume shipped in four months. Measured in dollars, 42% of the shipments were destinated for China while 33% was destined for Bangladesh. While the August-to-February volume shipped to China is up from the previous crop year at 917,201 mt, it is down 33% from the three-year average due to increased competition. Cumulative exports to all destinations are pegged at 1.702 mmt, up 54.1% from one year ago while 7.5% below the five-year average. Cumulative exports account for 68% of the current 2.5-mmt export forecast, ahead of the steady pace needed to reach the current forecast.

Chickpea exports totaled 27,856 mt, the largest volume shipped in nine months, with 23% of the dollar value shipped to Turkey, 19.3% shipped to the U.S. and 16% shipped to Syria. Cumulative exports of 138,433 mt are up 116% from the same period in 2021-22 and are up 87.7% from the five-year average. This volume has reached 69% of AAFC's 200,000 mt export forecast, a forecast revised 5,000 mt higher in February, well ahead of the steady pace needed to reach this forecast.

Mustard exports totaled 17,517 mt in February, the largest monthly volume in data checked to 2010-11 and potentially the largest monthly volume ever shipped. Cumulative volume shipped is 41.8% higher than one year ago and 32.6% higher than the five-year average. Cumulative shipments have reached 74.3% of the volume forecast by AAFC, which was revised 5,000 mt higher last month, well ahead of the steady pace needed to reach this forecast.

Canary seed exports totaled 13,897 mt in February, up slightly from the previous month. The largest volume was shipped to Mexico, with 35.2% of the value of exports shipped in this direction. Total exports to all destinations over seven months total 103,497 mt, up 10% from last crop year and 14.9% higher than the five-year average. Cumulative exports are slightly ahead of the steady pace needed to reach the current 170,000 mt volume forecast by AAFC for 2022-23.

Flax exports in March totaled 17,492 mt, down slightly from the previous month and the second lowest February exports seen in data checked back to 2011, next to the volume shipped in February 2022. The dollar value of the exports shipped to the U.S. accounts for 74% of the total, while a modest 18% of the dollar amount of exports was shipped to China. August-through-February exports to China, measured in volume, are down 87% from the three-year average. Cumulative exports of 93,302 mt are down 34.5% from a year ago and down 60.4% from the five-year average. Exports reached 62.2% of the current export forecast of 150,000 mt, slightly ahead of the steady pace needed to reach this forecast but note that AAFC reduced this forecast by 50% or 225,000 mt in February. This is poised to lead to the lowest exports in decades and will lead to a larger seeded acre drop in 2023 than the 5% drop currently forecast by AAFC.

Canada exported 171,235 mt of soybeans in February, down sharply from the previous month and the lowest monthly volume seen in four months. Of the dollar value shipped, 35.5% was shipped to China, 21.3% was shipped to Japan and 17.4% was shipped to Indonesia. Cumulative shipments over six months, or the first half of the crop year for row crops, is seen at 3.597 mmt, up 10% from last year and 8.4% higher than the five-year average. Cumulative exports have reached 74.3% of the current 4.4-mmt export forecast from AAFC, well ahead of the steady pace needed to reach this forecast.

Corn exports in February totaled 158,103 mt, up from the previous month and the largest February exports seen in 12 years. Of the total value shipped, 80% was shipped to a combination of exports to Spain, Ireland and the U.K. Cumulative exports over six months total 841,730 mt, up 33.2% from a year ago and 58.7% higher than the five-year average. The current AAFC forecast points to 1.750 mmt of exports for 2022-23, while the current pace of exports is slightly behind the forecast pace.

Corn imports during February totaled 197,826 mt, the largest monthly volume imported this crop year. Cumulative imports are down 73% from the same period in 2021-22 and down 36.6% from the five-year average. Imports are behind the steady pace needed to reach the current AAFC forecast of 2.2 mmt.

Canola oil exports in February were reported at 281,463 mt, down slightly from the previous month while the second-largest monthly volume shipped this crop year. Cumulative exports of 1.702 mmt are up 17% from the same period in 2021-22 and 3.3% below the three-year average.

Statistics Canada reported 391,431 mt of canola meal exports in February, the lowest monthly volume reported in six months. Cumulative exports total 3.089 mmt, up 21.6% from the same period in 2021-22 and 11.5% higher than the three-year average.

Ethanol imports totaled 156 million liters in February, the lowest monthly volume imported in five months. During the first two months of 2023, 333 million liters has been imported, up from 236 million in 2022 and the five-year average of 175 million liters.

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

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