The Canadian Wheat Board has increased its 2009-10 target by two million tonnes over mid-summer forecasts and is now projecting the highest total exports in 10 years.
In its annual Grain Marketing Report, expected to arrive in Prairie farmers’ mailboxes this week, the CWB has announced an export target of 18.7 million tonnes. The last time total exports exceeded this amount was in 1999-2000, when exports reached 19.2 million tonnes.
Despite fears of an early killing frost, record-high September temperatures led to high quality and high yields for the 2009 crop. “After experiencing a growing season in which crop production and quality was continually revised downward due to poor weather conditions, the CWB is pleased to be moving ahead with a strong export program notable for its high-quality grain,” Chief Operating Officer Ward Weisensel says in the report, which is available at www.cwb.ca/grainmatters. This year’s export program consists of 13.5 million tonnes of wheat, 3.5 million tonnes of durum and 1.7 million tonnes of barley. Total barley exports include up to 1.3 million tonnes of bulk malting barley. Marketing prospects having improved somewhat since the report was created, and several export targets could move higher. However, Weisensel noted that many challenges face the marketing of this year’s crop. Durum, in particular, is facing an overabundance of supply with world production now estimated by the International Grains Council (IGC) at a near record 40 million tonnes. North Africa, the major durum importing region in the world, had very good domestic crops which have significantly reduced import demand. IGC is now forecasting this year’s world bulk durum trade at 6.25 million tonnes, the lowest in 11 years. Weak demand, combined with large crops in Europe and North America, has pushed prices lower. Wheat prices have declined substantially since the peak of February 2008, amid abundant supply and fierce competition. This year’s Prairie crop is forecast to have lower-than-average protein, which will further pressure prices downward. Malting barley prices have also been under pressure, although recent quality downgrades in the Australian crop may help buoy prices and increased imports into China are expected. Feed barley export markets are currently unattractive compared to the domestic feed market. For 2009-10, the CWB projects farmers in Saskatchewan will receive about $186 per tonne for top-quality spring wheat, $159 for durum wheat and $145 for malting barley. An updated Pool Return Outlook will be released on Jan. 28.