Statistics Canada confirmed farmers hung onto a glut of feed wheat and barley from last year's crop that will continue to weigh on prices as the new crop comes to market, traders said on Tuesday.
Early frost and a rainy, prolonged harvest downgraded a significant portion of the 2004 harvest, and many farmers decided to bin their crops rather than accept poor prices, Statscan said in its report on stocks at July 31, the end of the 2004/2005 marketing year. "The long and short of it is, there's lot of supplies," said Charlie Pearson, a grain market analyst with the Alberta provincial government. Statscan said barley stocks were 3.489 million tonnes, just above the high end of trade estimates ranging from 3.1 million to 3.4 million tonnes.
That's 66 percent higher than last year, and the highest level since 1983, when stocks were a record 5.1 million tonnes, Statscan said. "Feeding of barley was limited by abundant competing supplies of feed wheat," Statscan said in its report.
All-wheat stocks were 7.992 million tonnes, up more than 31 percent from last year and just below trade estimates ranging from 8.0 million to 9.4 million tonnes.
Even though wheat production was 25.8 million tonnes last year - almost 10 percent higher than in 2003 - exports were down 6 percent to 14.5 million tonnes because of the lower-quality crop.
Durum stocks were 2.521 million tonnes, up 41 percent from last year and within trade estimates ranging from 2.5 million to 2.7 million tonnes. "The durum number is the concern, I think, given the (size) of durum crop we have coming up," a grain exporter told Reuters, noting Statscan recently forecast this year's durum crop above 5 million tonnes.
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