Rain delays planting, but prospects good for North American ag
Although the flood in Alberta has affected some agricultural producers, initial reports suggest that the impact on the agricultural sector has been relatively limited compared to the extensive damage inflicted on communities and public infrastructure in the province. The flood has hit producers only in the immediate vicinity of affected waterways, though it also resulted in the temporary closure of some meat processing facilities in the province. Overall, crop emergence in Alberta is reported to be noticeably ahead of last year,
In other regions, the BMO agriculture outlook noted:
- Saskatchewan crops are somewhat behind, producers in the province are reporting excellent crop quality.
- Wheat acreage in parts of the Prairies has been expanded this year, setting the stage for what could be a very strong harvest, provided the weather conditions remain supportive.
- Canola acreage is reported to be down moderately compared to last year – a reversal of the trend seen over the past decade – partly due to farmers’ shift towards wheat.
- In Ontario, conditions are broadly supportive of corn and soybean crops
- Apple farmers in Ontario are faring far better this year after a late-spring frost killed more than 80 per cent of their blossoming crop in 2012. A healthier harvest this year will also begin to re-apply downward pressure to apple prices.
- Ontario’s grape crop is also reported to be shaping up well. Although some growers have experienced higher than normal levels of precipitation, this year's crop is expected to be healthy as long as weather conditions remain balanced for the remainder of the season.
Crop prices in Canada have remained largely favorable, which would compound the financial benefit of a solid crop. Wheat prices remain elevated and canola prices are in the range of all-time highs. Corn and soybean prices also remain lucrative, although high prices have bolstered planting in both of these crops, which will likely apply downward pressure to prices as this year’s harvest makes its way to market.
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- Corn price premiums continue to fade