Canada Markets

Alberta Agriculture's first crop report of the season shows seeding progress as of May 3 to be behind year-ago progress but well ahead of the average pace. The 21% of the crop reported as planted compares to 27% last year, the five-year average of 9% and the long-term average of 15%. Progress is furthest ahead in the south, with 50.2% seeded, while the north-east and north-west regions are furthest behind at 2.4% and 2.8% complete, respectively.

The provincial government mentions delayed seeding progress for shallow seeded crops with hopes pinned on the receipt of rainfall to support this activity. This is clearly seen in southern planting progress, with the southern region reported to have seeded 26.7% of the canola, 26.3% of the mustard and 27% of the flax, as compared to the 61.2%,61.1% and 61.5% reported as of May 5 2015, respectively.

The attached chart shows the distribution of the surface soil moisture ratings as of May 3, broken into Poor, Fair, Good, Excellent and Excessive, while compared to a similar period between 2008 and 2015. The Good to Excellent surface soil moisture rating (green bar and purple bar) is combined to account for 43.5% of provincial cropland, which is down from 68.7% reported for the same period last year and the average of the five years from 201l to 2015 at 79%.

At the same time, the combination of the Fair to Poor categories (red bars and blue bars) accounted for 56.4% of the provincial cropland, as compared to 30.5% last year and the five-year average of 10.1%.

The dry conditions affecting Alberta in 2015 saw the 68.7% Good to Excellent surface soil moisture rating reported in the first crop report deteriorate for five consecutive weeks to 20%, improve to near 30% within two weeks only to fall back to the 20% level.

This situation has not been over-looked by markets. In particular, the Nov/Jan canola spread has narrowed from minus $5.60/mt on April 15 to a bullish spread of minus $1.40/mt today, narrowing $1.50/mt today alone. Commercial traders are getting nervous.

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

Follow Cliff Jamieson on Twitter @CliffJamieson

(ES)

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