WINNIPEG, (Manitoba): Canada trimmed its estimate of the country’s canola harvest, the smallest in 14 years, and slashed its assessment of durum production to the lowest level on record as severe drought scorched Prairie crops, a government report on Friday showed.
Canada is one of the world’s biggest wheat exporters and the largest producer and shipper of canola, used to produce vegetable oil and animal feed. The country’s drought has contributed to a drop in global supplies of high protein wheat that is critical in bread-making.
Canola prices have soared this year to all-time highs as crushers and importing countries like China and Japan competed for meager supplies.
Canola production amounted to 12.6 million tonnes, slightly lower than Statistics Canada’s September estimate of 12.8 million, which was also the average trade expectation in a Reuters survey.
StatsCan pegged the all-wheat harvest at 21.7 million tonnes, unchanged from its previous estimate but exceeding the average trade expectation of 21.2 million tonnes. The wheat harvest was down 38.5% from last year.
StatsCan cut its estimate of durum wheat, which is used to make pasta, to 2.7 million tonnes from 3.5 million.
The government agency’s reduction of its durum estimate reflects that the crop is grown in the “bullseye” of this year’s drought, said Jonathon Driedger, vice-president at LeftField Commodity Research.
Otherwise, the fresh estimates were unsurprising.
“If I had accidentally printed off the September report I might not have noticed it,” he said. “It’s an uneventful report.”
ICE Canada January canola futures rose slightly on the modest harvest reduction, gaining 1%.
The 16-million tonne spring wheat harvest is down 38% from last year, although StatsCan increased its estimate from September’s 15.3 million.
Statistics Canada used a farmer survey to determine the latest crop estimates, unlike its earlier production reports this year that it based on satellite data and analysis.