There are two completely different stories being told in the United States grain markets when it comes to exports, which are so closely watched. The pace of soybean export shipments continue well ahead of the level required to meet the USDA's projections for annual shipments. At the same time, wheat and corn exports are significantly behind the pace needed to meet the government's projections. Week after week, this negative data is released, leaving industry wondering when and if exports will recover. Markets have understandably suffered as a result.
Canada is not immune to these same headwinds from the global economy. I thought it would be interesting to look at year-to-date Canadian grain disappearance as compared to the most recent Agriculture Canada projections for both exports and domestic disappearance. Week 17 Canadian Grain Commission data covers grain movement up to the close of Nov 25, which marks the 32.7% point of the 52-week crop year which begins on Aug 1.
Attached is a chart which compares week 17 Grain Statistics Weekly data from the CGC to S and D projections from the Nov 13 Canada: Outlook for Principal Field Crops from Agriculture and Agri-Food Canada. The blue bars represent the percentage of year-to-date exports as compared to annual forecasts, the red bars represent the percentage of YTD domestic use as compared to annual forecasts, while the green bars represent total YTD disappearance as compared to the current annual forecast.
Overall, wheat exports are 6.5% behind last year's exports and 4.5% behind the three-year average. As seen on the attached chart, exports are at 27.5% of forecast, while total wheat disappearance is at 25.4% of forecast. Despite running slightly behind, producers continue to deliver wheat at a steady pace, suggesting the movement offshore will also remain steady. YTD producer deliveries are 8.2% ahead of last year and 17.4% ahead of the three-year average. Week 17 producer deliveries of 426,900 metric tonnes exceed the average weekly delivery of 341,500 mt this crop year.
Like U.S. soybeans, canola movement continues at a rapid pace, despite the need to ration stocks given the lack of supplies due to the reduced crop. There is also a school of thought that Statistics Canada may even reduce the size of the crop in its upcoming December 5 production report. As of week 17, canola exports are just 2% below last year while 7% ahead of the three-year average. Domestic consumption is 21.9% ahead of last year and 38.2% ahead of the three-year average. As seen on the attached chart, canola exports are 38.2% of forecast sales, domestic usage is 36.2% of forecast while overall disappearance is 37.3% of forecast.
There is currently no clear trend in weekly producer deliveries of canola. Week 17's weekly deliveries of 311,400 mt were just slightly higher than the 308,500 mt average weekly delivery of canola seen this crop year.
Durum exports, at 40.1% of the total forecast, are setting the most advanced pace among the grains, while total disappearance of 45.8% of forecast leaves the grain in a good position with eight months to go in the crop year. One anomaly on the chart is the posted domestic disappearance numbers for durum which beg clarification, given the small Canadian pasta industry.
I look forward to updating this data over time as both usage data is updated along with potential revisions to the crop-year forecast. Production changes announced on the Dec. 5 Stats Canada report will trigger the need for follow-up analysis.
Cliff Jamieson can be reached at email@example.com
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