Farmers
Pool Return Outlooks
2006-07 crop year
DATE: February 27, 2006
First CWB PRO For 2006-07 Shows Mixed Outlook For Wheat
Winnipeg -- The CWB today released its first Pool Return Outlook (PRO) for the 2006-07 crop year. The 2006-07 milling wheat PRO ranges from $7 per tonne higher to $8 per tonne lower compared to the February PRO for the 2005-06 crop year. Durum PROs for the new year are $8 per tonne higher to $1 per tonne lower compared to the February PRO for the 2005-06 crop year. The feed barley PRO (Pool A) is down $12 per tonne, while malting barley PROs range from $1 to $5 per tonne lower.
| February PRO | February PRO | |||
| 2006-07 | 2005-06 | |||
| - In store Vancouver or St. Lawrence - | ||||
| Tonne | Bushel | Tonne | Bushel | |
| Wheat | ||||
| 1 CWRS 14.5 | 214.00 | 5.82 | 222.00 | 6.04 |
| 1 CWRS 13.5 | 202.00 | 5.50 | 204.00 | 5.55 |
| 1 CWRS 12.5 | 194.00 | 5.28 | 195.00 | 5.31 |
| 1 CWRS 11.5 | 188.00 | 5.12 | 189.00 | 5.14 |
| 2 CWRS 13.5 | 196.00 | 5.33 | 191.00 | 5.20 |
| 2 CWRS 11.5 | 182.00 | 4.95 | 177.00 | 4.82 |
| 3 CWRS 13.0 | 177.00 | 4.82 | 173.00 | 4.71 |
| 3 CWRS | 164.00 | 4.46 | 159.00 | 4.33 |
| 4 CWRS | 133.00 | 3.62 | 130.00 | 3.54 |
| 1 CWHWS 13.5 | 202.00 | 5.50 | 204.00 | 5.55 |
| 1 CPSR | 159.00 | 4.33 | 152.00 | 4.14 |
| 1 CPSW | 165.00 | 4.49 | 164.00 | 4.46 |
| 1 CWRW | 156.00 | 4.25 | 150.00 | 4.08 |
| 1 CWES | 168.00 | 4.57 | 171.00 | 4.65 |
| 1 CWSWS | 174.00 | 4.74 | 177.00 | 4.82 |
| CW Feed | 118.00 | 3.21 | 116.00 | 3.16 |
| Durum | ||||
| 1 CWAD 14.5 | 207.00 | 5.63 | 208.00 | 5.66 |
| 1 CWAD 13.0 | 192.00 | 5.23 | 190.00 | 5.17 |
| 1 CWAD 12.5 | 187.00 | 5.09 | 185.00 | 5.03 |
| 1 CWAD 11.5 | 178.00 | 4.84 | 176.00 | 4.79 |
| 2 CWAD 13.0 | 181.00 | 4.93 | 174.00 | 4.74 |
| 2 CWAD 11.5 | 172.00 | 4.68 | 164.00 | 4.46 |
| 3 CWAD 13.0 | 162.00 | 4.41 | 155.00 | 4.22 |
| 3 CWAD | 155.00 | 4.22 | 149.00 | 4.06 |
| 4 CWAD | 137.00 | 3.73 | 135.00 | 3.67 |
| 5 CWAD | 118.00 | 3.21 | 116.00 | 3.16 |
| Feed barley | ||||
| 1 CW - Pool A | 113.00 | 2.46 | 125.00 | 2.72 |
| Designated barley | ||||
| SS CW Two-Row | 165.00 | 3.59 | 170.00 | 3.70 |
| Std Sel Two-Row | 162.00 | 3.53 | 165.00 | 3.59 |
| SS CW Six-Row | 159.00 | 3.46 | 162.00 | 3.53 |
| Std Sel Six-Row | 156.00 | 3.40 | 157.00 | 3.42 |
| Note: PROs are the CWB's estimate of crop year returns. Farmers who use PROs to make marketing decisions are advised that unusual weather in importing or exporting countries and other changes in market conditions could dramatically affect the price forecasts. PROs are not price guarantees and should not be confused with initial payments. PROs also do not represent CWB offer values for prospective sales transactions nor sales values for actual transactions. | ||||
PRO Commentary
2006-07 crop year
Wheat
The 2006-07 milling wheat PRO ranges from $7 per tonne higher to $8 per tonne lower compared to 2005-06 levels. On the supply side, reduced production in Argentina due to drought will limit their exports beyond the Brazilian market until late 2006. The U.S. Hard Red Winter wheat crop continues to suffer from adverse growing conditions, and production prospects remain uncertain. In the Black Sea region, Ukraine and Russia planted less winter wheat last fall due to dryness. This situation, combined with a lack of snowcover in the Ukraine, has left the crop vulnerable to cold weather. Frigid temperatures this winter have increased the likelihood of winterkill, and more potential exists for further yield losses.
On the demand side, world trade is expected to be steady to slightly stronger in 2006-07. Iraq has been buying a substantial amount of wheat so far this year, which has been supportive of U.S. wheat futures prices. India also unexpectedly entered the wheat import market, and the trade is uncertain as to what their final import volume may be.
Durum
While Canadian and U.S. durum production is forecast to be considerably lower than in 2005-06, North American durum stocks carried over from the previous growing season are burdensome. In Europe, reduced seeded area is expected to be offset by a return to normal yields after last year's drought. Minor exporters are expected to have a large presence in the export market this year. Most significantly, rainfall has been excellent in Northern Africa so far this year, increasing the odds of an above average crop, which would reduce import demand.
Feed barley
Global feed barley import demand is projected to decline in 2006-07, due primarily to increased barley production in North Africa and the Middle East. Barley production is also projected to increase in the Black Sea region, as Ukraine and Russia are expected to increase spring barley area due to greatly reduced winter wheat area. Burdensome Australian barley supplies are expected to weigh on export values over the next number of months until its supply situation eases. Barley production in the European Union is expected to increase, but the EU has not been aggressive in subsidizing exports. Canada's potential for feed barley exports will be influenced by the volume of the Canadian domestic crop, ocean freight rates, and foreign exchange.
Designated barley
Global malting barley trade is projected to increase due to stronger demand in China and the United States. Rising beer production in China will continue to increase malting barley demand, but the size and quality of the Chinese barley crop will also influence their import demand. Increased U.S. demand and relatively stable prices are expected to boost six-row malting barley price prospects. Australian production is expected to pressure two-row prices over the short-term. A continuation of weaker ocean freight rates would be a positive factor and the relatively strong Canadian dollar will be a negative factor for Canadian malt barley returns.
|
|
||||||||||||||||||||||||||||||||