The USDA thinks that Chinese canola imports will increase again in 2017/18. But how much more?
After admitting that canola production in Canada was bigger than expected, the USDA decided that they’d also upgrade the export side of the equation for the balance sheet.
Specifically, the USDA thinks that the Canadian canola harvest was a record 21.5 million tonnes, slightly higher than Statistics Canada’s 21.3 million-estimate.
With more supply they increased Canadian canola exports by 500,000 tonnes to 11.5 million tonnes.
The good news is that they expect China to take a lot of that.
Chinese rapeseed imports were increased to 4.7 million tonnes. Their previous estimate was 4.3 million tonnes.
Last year in 2017/18, China also imported 4.3 million tonnes.
Thus, Chinese canola imports should be up nearly 10% year-over-year, most of which is going to be owned by Canada.
We’ll take the demand!
Global Rapeseed Supplies Eased by Record Harvest in Canada
Based on an official survey of farms in Canada, higher reported yields of canola revised the 2017/18 production estimate upward this month to 21.5 million metric
tons from 19.9 million last month. The crop expanded to an all-time high due to record area and realization of the second-highest yield ever. Compared to 2016/17,
canola yields were reduced in Saskatchewan and Alberta, where crops were stressed by high temperatures and below-average rainfall last summer. Additional Canadian supplies may expand 2017/18 exports by another 500,000 tons to 11.5 million.
Indian rapeseed production for 2017/18, however, is expected to decline to 6.5 million tons after last month’s forecast of 7.2 million. Rapeseed planting in November was deterred for northern India by warm and dry conditions. Farmers there have also been disappointed with the price of rapeseed. Indian rapeseed area is seen falling 700,000 hectares short of the previous forecast (and equaling the 2016/17 area of 6.5 million hectares).
China is the top import market for Canadian export shipments and will be the main beneficiary of the larger supply. China rapeseed imports for 2017/18 are expected to increase to 4.7 million tons, up 400,000 tons from last month and the 2016/17 total of 4.3 million.