Canada Markets

Canada's merchandise trade deficit with outside countries increased by 210% or $1.683 billion in the month of August, given an undesirable combination of lower volumes and prices of exports, while increased prices of imports combined with lower volumes led to an overall higher cost of imports. This is a three-month high and the fourth largest deficit reported this calendar year.

Six of 11 sectors tracked saw exports fall in August, with the largest drop seen in the dollar value of energy exports. The value of Canadian exports totaled $43.952 billion (balance of payments, seasonally adjusted), a two-month low but still the third highest level of exports seen in 2015.

Ag exports as indicated by the farm, fishing and intermediate food product category were reported at $2.804 billion for the month of August, down slightly from July but still the second highest reported monthly activity reported this calendar year. Year-to-date exports are 1.3% higher than the same period last year and 12.6% higher than the three-year average.

The dollar value of wheat exports was reported at $614.8 million, with year-to date exports 3.4% below the same period last year and 14.7% above the three-year average. The dollar value of canola exports was reported at $513 million for the month, with year-to-date exports down 10.5% from 2014 and 1.6% above the three-year average.

Here's a look at some of the export data released for selected smaller crops grown.

Lentil exports for the month of August totaled 61,055 metric tons, the slowest start to the crop year since 2010/11. This volume is 44.4% of the volume exported in August 2014 while is 50% of the three-year average volume for the month. This is also well below the monthly volume needed to stay on track to reach the current 2 million metric ton target set by Agriculture and Agri-Food Canada. While exports are expected to be lower in 2015/16 than the previous year, activity in the coming months will increase. While CGC statistics only captures one piece of the total data, or activity into licensed elevators only, recent week 8 data for the week ending September 27 shows cumulative producer deliveries at 323,600 mt, up 213% from last year while bulk exports are reported at 159,200 mt, up 175% from last year.

Dry pea exports for the month of August were reported at 255,166 mt, a continuation of last year's aggressive pace of exports. This volume is 6.3% above August 2014 exports and 40% above the three-year average. As of week 8 or the week ending September 27, cumulative producer deliveries and exports into and out of licensed facilities are marginally higher than year-ago volumes. As of the end of August, exports of peas are ahead of the steady pace needed to reach the current 2.5 mmt export target set by AAFC.

Wednesday's trade data shows August canary seed exports at 9,897 mt, the slowest start to the crop year in three years. This volume totals 70% of the August 2014 exports while 84% of the three-year average. As of the end of August, exports are behind the pace needed to reach the current AAFC target of 165,000 mt.

Mustard exports as of the end of September totaled 9,516 mt, the lowest monthly volume moved in 7 months. This volume is 2.2% higher than August 2014 and 95% of the three-year average for the month of August. As of the end of August, exports are slightly ahead of the steady pace needed to achieve the current export target of 110,000 mt.

At 21,315 mt, August exports of flaxseed are 58% of the August 2014 volume and 79% of the three-year average for August. As of the end of this month, exports are well behind the pace needed to reach the 800,000 mt target set by AAFC.

Barley exports in August totaled 26,377 mt, just 25% of the volume exported in August 2014 and 49% of the 3-year average.

Oat exports in August totaled 119,265 mt, 97% of August 2014 exports and slower than normal at 74% of the 3-year average.

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

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