Wheat (excluding durum) Canada December Outlook

For 2018-19, Canadian wheat production increased by 4% from 2017-18 to 26 Mt, according to STC, as an 8% increase in seeded area was mostly offset by lower yields. The final production estimate was 0.7 Mt higher than the previous estimate.

Canada western hard red spring (CWRS) wheat accounts for 75% of the total wheat production at 19.61 Mt. Production for other classes of wheat: winter wheat (hard red, soft red and soft white): 2.51 Mt, Canada Prairie spring (CPS) 1.59 Mt, Canada Northern Hard Red (CNHR) 1.06 Mt, Canada western soft white spring (CWSWS) 0.47 Mt, Canada western extra strong (CWES) 0.12 Mt, other Canada western spring 0.27 Mt and Canada eastern spring wheat (mostly CERS) 0.39 Mt.

Saskatchewan accounted for 37.8% of the total wheat production, Alberta for 34.1%, Manitoba for 17.9%. Ontario for 8.4%, Quebec for 1.1%, British Columbia for 0.4% and the Atlantic Provinces for 0.3%.

Total supply rose by only 2% because of lower carry-in stocks. Exports are forecast to rise by 6% because of strong demand for wheat in world markets and less competition from Australia, Russia, Ukraine and the EU. Wheat exports were strong during the first four months of the crop year. Total domestic use is forecast to increase by 2%. Carry-out stocks are forecast to fall by 11% to 4.2 Mt, 27% lower than the past five year average of 5.72 Mt. The exports forecast is 0.5 Mt higher and the carry-out stocks forecast is 0.2 Mt higher than in the November report because of the increase in production.

World production of all wheat (including durum) decreased by 30 Mt to 733 Mt, according to the USDA. The EU and Russia accounted for most of the decrease in production, with smaller decreases for Australia, Ukraine, China and Turkey. The largest increase in production was for the US. Supply fell by 11 Mt to 1,013 Mt. Total use is expected to increase by 1 Mt to 745 Mt as growing use for food is mostly offset by lower feed consumption. Carry-out stocks are forecast to fall by 12 Mt to 268 Mt. However, China accounts for 144 Mt of the stocks, an increase of 12 Mt from 2017-18. Wheat stocks in China are generally not exported. Excluding China, world all wheat stocks are expected to fall by 24 Mt to 125 Mt.

In the US, all wheat production increased by 4 Mt to 51.3 Mt, according to the USDA. Supply rose by only 1.2 Mt to 85 Mt because of lower carry-in stocks. Domestic use is forecast to rise by 2 Mt and exports are expected to increase by 2.7 Mt. Carry-out stocks are forecast to fall by 3.4 Mt to 26.5 Mt.

The average crop year producer prices for wheat in Canada for 2018-19 are forecast to increase from 2017-18, because of the lower world supply and strong export demand. However, protein premiums are lower than for 2017-18 because the protein content for US hard red winter wheat is higher and the production for US hard red spring wheat increased. Producer prices for CWRS wheat fell in September, from the start of the crop year, but recovered in October. Prices of other classes of wheat also fell in September, but, in general, recovered in October or November. The recovery in prices is partly due to the weaker Canadian dollar.

For 2019-20, Canadian winter wheat area, seeded in the fall of 2018, fell by 4% to 544,700 hectares (ha). Eastern Canadian area, mostly Ontario, rose by 3% to 434,400 ha, while western Canadian area fell by 23% to 110,300 ha.