Canada Markets

Reports from Statistics Canada's International Merchandise Trade suggest that the impacts from the strengthening U.S. economy as well as the lower Canadian dollar have resulted in a favorable report for February.

In total, Canada's exports rose 3.6% in February, which lead to the first monthly surplus since September. While January's trade numbers resulted in a $337 million deficit over all for the Canadian economy, a $290 million surplus was recorded for February.

The small shippers such as those competing in the special crop industry are facing substantial challenges in moving product in the current environment. A Pulse Canada spokesman, presenting to the House of Commons Agriculture Committee this week, reported that in the quarter ending March 31, only 49% of the hopper cars and 43% of the box cars were received by the members surveyed. On a weekly basis, only 20 to 60% of the cars ordered were spotted for any given week.

Despite these challenges, lentil exporters were reported today to be at 109,303 metric tonnes for the month of February while 985,304 mt in the August-to-February period. Year to date, this volume is 27% above year-ago levels and 33% above the average of the August-through-February period over the past three years. The current Agriculture and Agri-Food Canada forecast would see 1.450 million metric tonnes shipped this year, with current year to date movement on track to potentially exceed this level.

Meanwhile, 9,923 mt of mustard was exported in the month of February, with 80,163 mt shipped year to date. This is 19% above year-ago levels and 23.4% above the three-year average movement for the August-through-February period. AAFC has forecast 2013/14 exports to total 120,000 mt, so the potential exists to surpass this level and leave ending mustard stocks very tight.

The trade exported 10,924 mt of canary seed in February, with year-to-date volumes totaling 91,624 mt. This is 33.6% ahead of the volume shipped as of the same time one year ago, while 21% ahead of the three-year average as of the end of February; 120,000 mt of product is forecast to move this year by AAFC, which suggests that movement is well on track to meet this volume. At the same time, the current export forecast is suggested to result in a 5,000 mt carryout, which is extremely low, so the next few months could result in a forced increase in canary seed supplies on paper should actual movement exceed the current AAFC forecast.

Turning to sunflowers, 4,807 mt were exported in February, the highest volume month for exports seen this crop year. Year-to-date, exports total 27,488 mt, 37% below year-ago levels. Total exports for the crop year are estimated to be 45,000 mt. Exports are perhaps set to reach this volume however, like canary seed, stocks will be pushed towards zero and may be the limiting factor.

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

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