Pulse Market Insight #217 SEP 30 2022 | Producers | Pulse Market Insights
Crop Size is Still an Open Question
The pulse harvest in western Canada is now complete. In theory, that should mean we have a pretty good handle on the size of crops but in reality, estimates are always just that, estimates. They’re either the result of computer models, surveys or field observations and they’ll never be 100% accurate. In fact, getting too caught up in figuring out the accuracy or reliability of “a number” can get in the way of viewing the bigger market picture. In our view, these estimates are meant to be held lightly.
That said, we need to start somewhere. The main sources we use for yield and production estimates are StatsCan and provincial crop reports, which use very different methods. The first two StatsCan yield reports of the year are based on computer models using satellite images of vegetation. In December, StatsCan will switch to the results of a large survey of farmers. Meanwhile, Alberta and Saskatchewan Ag crop reports use the observations of field reporters to produce yield estimates. Sometimes, these estimates are close. Other times, not so much.
When we look at peas, there’s one added wrinkle in the crop outlook. Because of planting delays in the eastern half of prairies, there’s a good chance some peas didn’t get planted. There’s a widespread belief that seeded area could be 300-400,000 acres less than StatsCan’s number. On the yield part of the crop equation, StatsCan reported a yield of 40.1 bu/acre while the combination of provincial crop reports would put the yield around 38.7 bu/acre.
The combination of fewer acres and lower yields in the alternate scenario would put the 2022 pea crop at 3.12 mln tonnes versus StatsCan at 3.59 mln tonnes. That’s a large enough difference to have a meaningful impact on the amount of peas available for export and affect the 2022/23 ending stocks.
There’s also a sizable difference in the estimates for lentils. According to StatsCan, the 2022 yield was 1,438 pounds (24.0 bushels) per acre, resulting in a crop of 2.78 mln tonnes. Alberta Ag hasn’t released a specific yield estimate for lentils but has reported the 2022 yield could be at least 20% above the 5-year average. The yield from Sask Ag isn’t nearly as positive and is pegged at 1,174 pounds per acre.
Combining a 20% increase for Alberta with the lower Sask Ag yield and weighting by acreage would put the western Canadian yield at 1,205 pounds (20.1 bushels) per acre. Based on that yield, production would come out at 2.33 mln tonnes, 450,000 tonnes less than StatsCan. Just like peas, that difference in crop output would put a crimp in export potential and could tighten up 2022/23 ending stocks.
For chickpeas and dry beans, there are even more questions about both acres and yields. Because these are smaller crops, there’s less data available, making them harder to gauge and prone to big revisions later in the year.
Ultimately, these calculations are just another set of estimates and, as we said, they’re meant to be held lightly. Plus, other countries are also growing and exporting pulses. Often, the best indication of supply levels is how prices behave over the coming weeks and months. Of course, that also includes a bunch of demand factors, which can sometimes overshadow the supply side.
Pulse Market Insight provides market commentary from Chuck Penner of LeftField Commodity Research to help with pulse marketing decisions.