Again I question will Canada produce a 15 Mil crop of Canola!

[SASKFARMER3]

Rain makes grain. That is true but down
pours make mud, and mud makes shit all.
So if one gaters a look at the weather
outlook for June it is easy to see were
in for one heck of a not fun month.
Bring back March!!!! It looks like 4
sunny days and the rest rain. The next
looks like 150 mm for SE part of sask.
Yea 150 mm in our area to East central
Sask will take this crop out.
Now some of you say it doesnt matter,
Yes it does the largest Canola growing
area in Canada is East Central to NE and
SE. Not manitoba or Alberta. So if you
start loosing acres in those areas I
dont care if the others produce 60 to 70
bushels an acre they wont add up to the
losses here.
So charlie how will a Zero carry over
and less than 15 mill production play
out.
Ok pst since water is still running in
our fields and both drills wont stay on
top till Sat. Yea dealer buried the Case
floater, driver stepped out of cab onto
the ground. 2010, 2011, 2012.
Reality Bites!!!!!!

[SASKFARMER3]

Steady rains have delayed planting in
the canola belt of Saskatchewan, raising
the chances of some Canadian farmers
switching to shorter-season crops or
fields going unplanted.

Most growing areas in Saskatchewan,
which grows more canola than any other
Canadian province, received more than
twice as much precipitation as normal in
May, according to the Canadian
government's Drought Watch website.

The rain is welcome in western
Saskatchewan, but in the east-central
part of the province -- home to three
major canola crushing plants -- planting
is lagging behind, said Grant McLean, a
cropping management specialist for the
provincial government.

"There's water running in the fields,"
he said. "The rain has slowed things
down."

Overall in Saskatchewan, crop planting
is about three-quarters complete, ahead
of the normal pace, McLean said.

Alberta planting has lagged this spring,
while Manitoba seeding is nearly
complete.

Canada is the biggest grower of canola
and the top exporter of spring wheat,
durum and oats.

Farmers in eastern and central
Saskatchewan typically grow plenty of
canola to supply oilseed crushing plants
owned by Cargill Ltd, Richardson
International Limited, and one co-owned
by Louis Dreyfus Corp and Mitsui & Co
Ltd.

Farmers in those areas are considering
switching some acres from canola to
shorter-season oats or barley to avoid
autumn frosts, McLean said, but they
will be hesitant to do so given canola's
greater profitability.

As the rains fell in the past week, ICE
Canada November canola futures rose 2.2
percent.

As of May 21, overall crop planting in
east-central Saskatchewan was less than
half finished.

The wet conditions raise the prospect of
more land going unplanted, McLean said,
but farmers still have nearly three
weeks until June 20, Saskatchewan's crop
insurance deadline for farmers to
qualify for yield-loss liability.

Western Canada planting conditions have
generally been much better than the past
two years, when severe spring flooding
washed out large stretches of farmland.

Statistics Canada forecast in April that
western farmers would leave nearly 4
million acres unplanted this year, less
than one-third of the previous year's
fallow land.

But after warm, dry conditions in early
spring, rains fell in abundance in May,
accompanied by a series of light frosts
that caused some minor crop damage.

In Alberta, Canada's second-largest
producer of wheat and canola, previously
dry eastern areas received more
precipitation than normal in May,
stalling planting progress.

"There are some significant chunks of
land unseeded and people are getting
back onto their land (after) almost a
week delay," said John Mayko, who farms
east of Edmonton and is an agronomist
with Agri-Trend. "There are fields with
as much water standing on them as they
did when the snow melted in spring."

Overall seeding in Alberta was just over
half finished as of May 17, well behind
the usual pace, according to the
provincial government.

Environment Canada is forecasting rain
in parts of Saskatchewan on Wednesday
and Thursday and possibly during the
weekend. Alberta's five-day outlook is
mostly dry.

Southwestern areas of Manitoba, where
seeding lags the rest of the province,
looks dry, with a small chance of rain
on Thursday.

[GreenValley]

How strange, my friend down in Oyen area said in winter very very very dry and was worry might seeding in Spring. And at seeding time they got wrong, instead wet Spring. About 1 or 2 qtr left to go due to wet. But didn't going seed any canola instead wheat and oat. Has earth upside down!!

[charliep]

Just curious on your opinion about how much of the current weather/production uncertainty is already built into the market? Other that not forward contracting new crop, what strategies would you suggest around new crop canola marketing? Charts I would look at are below.

[URL="http://www.farms.com/markets/?page=chart&sym=RSX12"]Nov canola[/URL]

<a href="http://www.farms.com/markets/?page=chart&sym=ZLZ12">Dec beanoil</a>

<a href="http://www.farms.com/markets/?page=chart&sym=D6Z12">dec loonie</a>

<a href="http://www.copaonline.net/documents/COPAWEEKLYMAY232012.pdf">COPA crush margin</a>

[charliep]

Someone noted the camola meal in the past so will put the chart in. Canola meal has a lower protein and energy content than soymeal although well suited to dairy.

[URL="http://www.farms.com/markets/?page=chart&sym=ZMZ12"]dec soymeal[/URL]

[charliep]

Won't get into the production forecasting business at this point. Demand is solid at 15 million tonnes but question is how a smaller crop will play out. As canola pushs above world oilseed/vegetable oil prices, I suspect the demand side will start to slide starting with exports/China - pace will slow as buyers move to other crops. You have to start running some scenarios around soybeans/the whole world vegetable oil complex.

My thoughts is a fair bit of weather premium is getting built into this market that has potential to flush out/drive prices lower if outlook starts to turn around. You will have to watch Chinese policy/buying - they have been active in the new crop market given uncertainty in both US soybeans and Canadian canola. Will this continue? If China becomes more comfortable with the supply situation, what will they do?

[errolanderson]

SF3 - believe the weather problems in
your area are certainly bullish fall
basis levels, but not necessarily the
futures. Still fearful of a sizable
setback in canola prices ahead.

Global deflationary pressures are too
great. Global bond markets continue to
heat up. The U.S. dollar is rolling
higher.

Note: Nov canola $560 puts traded today
for $19

Strike $560 - premium $19 = $541/MT
($12.27/bu) plus or minus your fall
delivered basis.

IMO . . . hug 'n hold your cash canola
market protection.

Errol

[charliep]

A expression I have heard over time is bull markets have long tails.

Seems to be backed up by the fact my experience is record canola crops seems to go with record prices and small carry overs. Smaller crops that have been anticipated by the market tend to be years of declining prices and larger that expected carryovers.

[wd9]

No one knows the answer for sure, but
stats can says 20.7 mil acres. Easy
enough to get 15 mil tonnes, or close
enough. But so what, its not like canola
sets the price anyway. Market demand is
strong for canola and we are farther
ahead in the long run producing more to
keep customers buying than having a
short crop and have customers switch.

Where is the long term benefit of that.
SF3, do you really think 15 mil tonnes
of canola is a bad thing? If you do, you
best look a little deeper into how the
whole value chain works. You can't try
to squeak out your few bucks on a short
crop in one year. You build a business
with a product that has consistent good
supply year after year.

[bucket]

errol

If the USD continues higher, will the CDN$ not fall back adding some support to prices?

Everyone talks about how, if we had a lower dollar our prices would be higher, and yet its seems our best prices have been with a par dollar.

[LWeber]

Like China will quit buying Canadian canola when they are paying their farmers $810.30/metric tonne... $18.38 bushel...

[errolanderson]

bucket . . . the Cdn dollar will likely
remain under pressure which is good news,
but should the soybean market suddenly
cave, canola will follow regardless IMO.

Soybeans are King Kong of this market.