Pricing triggers planting

Canada is a major producer and exporter of these grains, which also go into the same markets that Australia exports.

The North American nation produces much more of these crops than we do, and exports a lot more as well.

It is also a major producer and exporter of bread wheat, but does not dominate the global market in the same way.  

Barley is the other major crop of interest to us, but again Canada’s influence on the global market is not quite as intense as it is for the minor crops.

Last year global durum production increased by 4.8 million tonnes to 39.3mt with a lift in carryout stocks of 1.3mt.

While stocks in Canada dropped a little, this year they are expected to lift by 300,000t as increased production outpaces its ability to make sales.

With rising global and Canadian durum stocks, we should expect durum prices, and the premium for durum ahead of bread wheat, to come under pressure this year.  

High prices have triggered an increase in global plantings, and prices will fall.

It is different for canola, where the area planted in Canada is set to decline this year as growers shift over to more pulses and durum.  

Carryout stocks for 2015/16 are already down year-on-year, and with lower supply, Canadian exports are set to fall by 2mt this year.

Stocks will fall further.   

With lower rapeseed supply in the European Union and reduced exports of canola from Canada, there should be good support for our canola prices this year, particularly if our weak dollar prevails.

Lentils appear set for a massive increase in acreage in Canada and Australia.

Last year Canada produced 2.373mt of lentils.

This is expected to jump to 3.255mt this year, but Canada won’t increase exports by much, leaving a sharp increase in stocks.

Canadian lentil prices are tipped to fall by 25 per cent this year.