Crop Update - June 29th 2017

Depending on who you speak and which area they are farming, will tell 2 different stories. In the southeast of Saskatchewan, pulse crops look good with nice canopy cover and plants standing about 18-20 cm.  Subsoil moisture remains adequate but the recent winds have dried out the top 5-6 cm. As we move east towards Manitoba we have very wet conditions with crop development slightly delayed.  The north and northeast and northwest has adequate moisture, not question on this point.

If we draw a line from Regina in the south and move north towards Saskatoon, we can see how the subsoil moisture has diminished recently. Again, this is mainly due to recent strong winds and the lack of additional rain activity.  Crops are most seriously impacted by dryness in the south and south west of Saskatchewan.  Rain is desperately needed in the next 10-14 days or yields will likely be reduced.  (see Cropland Topsoil Moisture Conditions below)

Even with the continued optimistic outlook for crops, farmers remain disinterested in the new crop market.  This could be for numerous reasons:  price, concerns on yield, insect damage, root rot to name a few.  Regardless of the reasons, farmers just aren’t selling.  This seems to be in contrast with exporters positions or perceptions of potential crops.

Today, there remains several offers from numerous sellers on new crop lentils.  Chick peas is another story; no farmers selling and to the best of our knowledge, the trade is also defensive.  Chick pea crops are primarily grown in the south and southwest of Saskatchewan and Alberta; recent crop reports are positive.

It is reported, some pulse crops remain behind their 5-year average for crop development.  This can change very quickly of course with increased temperatures across the grain belt.  It has been somewhat cooler the past 7 to 10 days with temps around 20 C for the most part.  Next week’s forecast is showing low to mid 30’s with no precipitation.

Below are the 2017 crop lentil estimates, by variety, based on Stats Canada reports.  Frankly, we are somewhat surprised to see the forecast of about 25 % less lentils seeded this year.  We expected about 20% less.  We are also very surprised at the large green estimate.  Based on our surveys with producers and plants (granted, they will not be as encompassing as other forecasters) we expected 20-25% less large green in 2017.  Stats Canada is predicting only about 10% less in 2017.

Crop Update - June 15th 2017

It has been a great week for crops in Western Canada.  We received some showers this week with up to 30-40 mm in the Southeast and 15-20 mm in most of the other pulse production areas.  As the attached moisture map indicates, soil was beginning to dry up with the constant dry winds and high temperatures over the last 3-4 weeks.   As temperatures dropped into the low 20’s this past week, this has also been positive for crop development as we were in the low to mid 30’s across Saskatchewan in the previous 10-14 days.

Although crops are looking good with no significant reports of disease, insect damage or root rot, we still have farmers hesitating on hedging additional new crop lentils.  (Chick pea sellers are extremely quiet as well). 

With CIF lentil markets being quoted/offered below current NC producer bids, we see the following possible scenarios: 

  • Traders are becoming bearish and therefore attempting to get some short sales on the books.
  • Processors concerned with volume, trying to secure some orders for fall. 

Regardless of the motives, the NC market is relatively quiet with buyers anticipating lower prices.   Some sellers seem to agree, or at least are following, in an attempt to get something on the books.  It is important to also consider the old crop market is extremely slow and this may be influencing some of the new crop trading.

We remain very defensive on new crop for the same reason we have been the last 3 years:

No carryover of any decent quality lentils and zero chick peas of human grade.  As we all know, anything can happen in Canada and one frost or a week or two of heavy rains can quickly turn beautiful crops into ugly crops.