While the latest round of NAFTA negotiations continues in Montreal, DTN Ag Policy Editor Chris Clayton notes U.S. President Donald Trump stating, "NAFTA is moving along pretty well. I happen to be of the opinion that if it doesn't work out, we'll terminate it. But I think you're doing pretty well ... from what I understand. So we'll see how it all works out." The stakes remain high, with media reports suggesting that 20% of Canada's GDP is tied to NAFTA trade.
Meanwhile, grain continues to flow south at an above-average pace. As seen on the attached chart, the Canadian Grain Commission reports 615,900 metric tons of wheat (excluding durum) has been shipped to the United States in the August-through-December period, up 57.4% from the same period last crop year, higher than the five-year average and the largest volume shipped during this period in four years.
The same report shows 204,100 mt of durum shipped in this five-month period, up 375% from the same period last year, well above the five-year average and the largest volume shipped in this period in CGC data going back to 2009/10.
The January USDA supply and demand tables saw a modest increase in the forecast import volumes for hard red spring wheat and durum since the December report, with total red spring imports forecast at 75 million bushels (2 million metric tons), up 79% from 2016/17. Durum exports are forecast at 47 mb (1.3 mmt), up 57% from the 2016/17 crop year.
Another grain that sticks out on the chart is the movement of oats. As of December 630,300 mt of oats has been shipped, up 37.8% from the same period last crop year and a similar percentage above the five-year average. This is the largest volume shipped in this period in nine years. The latest USDA estimates indicate an expected 100 mb or 1.5 mmt to be imported this crop year, up just 11% from the previous crop year.
Of the grains shown, only the movement of canola trails year-ago volumes, while the movement of barley is the only grain to trail the five-year average.
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Cliff Jamieson can be reached at firstname.lastname@example.org
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