Canola on track to bounce back year with higher demand and prices

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One of the biggest canola crops in a generation should be better than last year’s drought-affected crop, but growers are still nervous it’s behind schedule.

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Local farmers got a reprieve from Mother Nature with a break from dry spring weather, but a cool, wet June slowed development and stunted some of the growth.

Considering the widespread devastation last year, they will reap what is expected to be an average crop this fall.

“Everything is going very, very well right now,” said Ian Chitwood, vice president and director of the Alberta Canola Growers Commission, who planted 1,200 acres of canola on his farm near Airdrie this year. “We’re getting really good moisture for the first time in a couple of years. And if we can avoid some hail, I hope it will be a very good harvest.”

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Between the drought, the heat dome, and a late hail storm in 2021, their canola crop was wiped out. As a dryland farmer, he is completely dependent on timely rainfall.

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Alberta’s latest crop report from July 29 shows a bit of a mixed bag for canola progress across the province, although the southern region has the lowest score with only 54.5 percent of canola rated good to excellent. The yield estimate in the South is currently at 35.2 bushels/acre, just below the five-year provincial average (37.5) and the 10-year average (38). Last year, canola in the South averaged 16.1 bushels per acre, with a provincewide average of 28.

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Almost all of Canada’s canola is planted on grasslands. Saskatchewan farmers reported planting more than half of the national total on 11.4 million acres, while Alberta planted 6.5 million acres and Manitoba growers planted 3.3 million acres.

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The challenge growers face is the stage of development, with a harvest of only 28% pods in Alberta, where the 10-year average for this time of year is 56%.

This means growers may have to wait a bit longer for their crop to be ready or harvest it sooner. Holding out longer brings with it a myriad of weather-related variables that are gambling at best.

There was also an issue in mid-July about abnormal capsule development the cause of which has yet to be determined by the commission. These reports have also started to decline.

Still, as long as they get the precipitation they need at the right times, they are in better shape than last year.

“A long open fall would be really ideal to bring in the harvest,” said Karla Bergstrom, executive director of the Alberta Canola Growers Commission.

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He added that 90 percent of canola in Canada is exported.

StatsCan estimates that 21.4 million acres of canola were planted across Canada this year, down from last year when 22.5 million acres were planted. Still, this represents an increase from 2020 (20.9 million) and 2019 (21.2 million). Canola is Canada’s second largest crop after wheat (25.4 million acres planted) with barley in third place with seven million acres planted.

The global need for this crop is higher than ever.

The cooking oil situation has improved in recent weeks with Indonesia lifting its ban on the palm oil trade earlier this summer and a better-than-expected crop harvest in the southern hemisphere, according to Sylvain Charlebois, director of the Laboratory of Agrifood Food Analysis from Dalhousie University.

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The big blow remains the invasion of Ukraine and how it has crushed sunflower crops.

According to the Food and Agriculture Organization of the United Nations, Ukraine expects only a few 45 percent of the sunflower harvest as they are normally affected by war in the amount they could plant and a decrease in yield. Ukraine is the largest producer of sunflower seeds and sunflower oil for export in the world, together with Russia accounting for about 55 percent of world production.

In addition to the drop in production, they are having a hard time exporting what they have due to limited access to ports to ship sunflower. Last weekend, through a grain export agreement, Ukraine was able to obtain four ships with corn, sunflower and soybeans for export: 12 shipments will be part of this negotiated agreement with 10 leaving Ukraine and two entering.

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The global shortage has increased demand for other canola cooking oils.

“Things are loosening up a little bit,” Charlebois said. “We need 700 boats to take care of all the reserves in Ukraine from last year’s harvest. But there are still positive signs that things are moving. I am more optimistic than last week.”

All of this means that if canola farmers can get a good crop, they will get a higher-than-normal yield, even if commodity prices have fallen from their previous highs of around $25 a bushel to around $20. Some growers managed to secure the highest price and should see a necessary payday with one of the most expensive crops in history to plant.

“I definitely feel a lot better this year than I did last year,” Chitwood said. “We’ve been getting good moisture just when we need it… Prices look good. The drop looks good. Everything is lining up. As long as we can avoid the hail, we’ll be fine.”

[email protected]

Twitter: @JoshAldrich03

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