Overview of AAFC’s grain stocks forecast

The attached chart shows the expected year-to-year change in stocks for major crops. Of the crops shown, stocks of peas, soybeans, oats and corn are expected to fall year over year. Flaxseed, canola and wheat (excluding durum) stocks are expected to show a modest year-over-year recovery. These increases would disappear with any decline in yield relative to the averages used by AAFC, leaving all other estimates unchanged.

As shown in the attached chart, the largest year-over-year inventory increases are expected for durum wheat and barley. According to AAFC, global durum wheat trade is expected to fall by 7% in 2021-22 due to a recovery in production in Europe and North Africa. The largest increase in stocks is seen with a 100% increase in barley stocks, from 500,000 tonnes in 2020-21 to 1 mmt in 2021-22. At 1 mmt, stocks would still be below the current five-year average (2015-16 to 2019-20) of 1.326 mmt.

Statistics Canada’s estimate for 2021 acres of barley could see a higher revision coming. At the same time, AAFC has included a weaker export forecast for the upcoming crop year, which could also be revised upwards. USDA’s first review of China’s corn imports for 2021-22 shows imports unchanged year-over-year, while recent surge in daily sales of US corn sold to China signals a intention for the coming year.

Note that the lens bar does not appear on the attached chart. Indeed, AAFC left its 2021-22 ending inventory forecast unchanged from the previous year at 100,000 mt. While not the lowest stocks seen in Statistics Canada data, stocks remain tight and could tighten further.

We wish everyone a safe and happy Victoria Day long weekend!

Cliff Jamieson can be reached at [email protected]

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