How Has Acreage Historically Changed in Statistics Canada's June Update?

Statistics Canada is set to issue its June acreage update later this month. This week, FBN examined historical acreage changes for spring wheat, durum and canola from the initial March report to the June update. FBN has not conducted an acreage survey for plantings; this exercise is meant to be informative.

Spring wheat acreage is usually trimmed

In March, Statistics Canada forecast spring wheat area at 18.772 million acres, which was essentially unchanged from 2019 planted area at 18.782 million acres. But Statistics Canada usually revises its planted area outlook in the June report. Given the history since 2010, we can expect a modest cut to spring acreage in the coming report. In every year since at least 2010, Statistics Canada has lowered its spring wheat acreage estimate. The average cut is 544,000 acres, which means acreage could come in closer to 18.2 million acres. While not much, that is a move in the right direction.

spring-wheat-acreage-revisions-062020

Durum acreage changes are a mixed bag

The average adjustment for durum is a cut of around 10,000 acres from March to June. But one year, 2018, sticks out as a large revision to the upside. That year, 408,000 acres were added to the March durum acreage forecast. If that were to happen this year, durum planted area would come in near 5.6 million acres, up from 5.2 million acres issued in March. What FBN wants to point out is that even if durum acreage were increased by that record amount, the balance sheet still would not be considered “bearish.” Rather, it would then move to a neutral standpoint at worst. The durum balance can manage additional acreage even at that level. 

Canola acreage revisions are usually to the upside

Statistics Canada usually makes production revisions to the upside and, it turns out, acreage revisions usually are higher as well from March to June. On average, Statistics Canada adds 604,000 acres to canola. In the past 10 years, only last year featured a cut in planted area between the reports. That means the canola balance sheet is at a double risk — higher production revisions for 2019 (we’ll explore those in detail next week) and potentially higher acreage for 2020 — if this year falls in line with history. If 2020 is revised higher by 604,000 acres, acreage would come in close to 21.2 million acres. The good news is that this potential addition would not wreck the balance sheet outlook for 2020. The bad news is that it could add pressure to the market.   

canola-acreage-revisions-062020

FBN's take on what this means for the farmer

Strictly based on history, the odds are that spring wheat area will be revised lower, durum acreage will be slightly changed, but canola acreage could be increased. There were some pockets of planting issues this year, but no significant delays. In essence, while acreage changes could be forthcoming, they likely will not cause significant changes to the current price outlooks for canola, spring wheat and durum.

Want access to more insights like this?

This article is excerpted from our Market Intelligence newsletter, delivered weekly to FBN Market Advisory members. With FBN Market Advisory, you'll receive truly personalized tools and reports to support your grain marketing efforts. Get access to market news, straightforward marketing recommendations, basis trend insights and weather reports—all relevant to your operation and geographic location.

CGM-Canada-2019

FBN Crop Marketing Canada, Inc. does not guarantee any specific benefits or value from participating in FBN Crop Marketing; results will vary. Past performance is not necessarily indicative of future results. FBN Crop Marketing Canada offerings involve risks, including the risk that market conditions deteriorate, resulting in contract participants receiving lower prices for their grain than had they not participated in the FBN offering. 

Copyright © 2015 - 2020 FBN Crop Marketing Canada, Inc. All rights reserved. The sprout logo, "Farmers Business Network," "FBN," and "Farmers First '' are registered service marks of Farmer's Business Network, Inc. and are used with permission. All other trademarks are the property of their respective owners. FBN Crop Marketing Services are offered by FBN Crop Marketing Canada, Inc. and are available only in provinces where Farmer's Business Network Canada, Inc. is licensed. FBN Crop Marketing Canada, Inc. Box 5607, High River, AB T1V 1M4, Canada.