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RPT-UPDATE 2-Canada canola stocks soar to record high, wheat supplies grow
May 5, 2014 / 3:00 PM / 4 years ago

RPT-UPDATE 2-Canada canola stocks soar to record high, wheat supplies grow

(Repeats without change)

By Rod Nickel

WINNIPEG, Manitoba, May 5 (Reuters) - Canadian canola stocks were at a record high at the end of March, and wheat supplies had swollen to the largest in 20 years, Statistics Canada said on Monday as a bumper crop and transport bottlenecks produced huge piles on the Prairies.

Statscan pegged canola stocks at March 31 at 9.02 million tonnes, nearly double last year’s level. All-wheat supplies reached 21.25 million tonnes, up 47 percent from 2013 and the most since 1994.

“The wheat number is significant for the North American market, because, obviously, there is a shrinking (U.S.) hard red winter crop,” said Ken Ball, a broker at PI Financial Corp in Winnipeg. “If we can get the (Canadian) wheat down there, it may balance out the North American wheat market.”

Sweltering temperatures in the Southern U.S. Plains have deepened fears about weather damage to the U.S. hard red winter wheat crop.

Statscan surveyed 11,424 farmers from March 24 to 31. The report comes just as Canadian farmers get set to begin planting.

ICE Canada July canola futures were down 0.9 percent, adding to their decline before the release of the report. Minneapolis July spring wheat futures were up more than 1 percent.

Late ice cover on the Great Lakes has compounded the backlog in moving Western Canadian grain, which piled up due to the frigid winter and record harvest, overwhelming railways that transport crops to port.

Farmers were stuck with most of the increase in crop supplies. Statscan said commercial stocks of both wheat and canola had declined year over year, while on-farm storage jumped.

The three Prairie provinces of Alberta, Saskatchewan and Manitoba held record volumes of canola in farm bins and temporary storage.

Statscan asked additional questions in this survey about permanent on-farm storage capacity and how much crop farmers had stashed in temporary storage. Nearly 14 percent of all grain held on farms was in temporary storage, such as bags, the survey found.

Farmers struggled during the winter to find buyers for their crops at profitable prices as commercial grain handlers said railways delivered far fewer grain hopper cars than needed.

Railway movement has improved as the weather has grown milder, said Bruce Burnett, weather and crop specialist at grain marketer CWB. A backlog of orders for grain cars remains, but the eastern flow of grain through the seasonal Port of Thunder Bay, Ontario, on Lake Superior should start to pick up, he said.

Canada is usually the world’s second- or third-largest wheat exporter and the biggest shipper of canola, a cousin of rapeseed that is largely used to produce vegetable oil.

Stocks were also much higher year over year of oats (60 percent), barley (43 percent) and durum (32 percent).

Reduced cash flow due to the grain backlog likely won’t affect planting, but may be a factor in the amount of crop inputs, such as fertilizer, farmers apply, Burnett said. (Reporting by Rod Nickel in Winnipeg and Alex Paterson in Ottawa; editing by Peter Galloway)

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