Strong prices are expected to attract more flax acres this year, but at least one analyst sees the market holding up relatively well in the face of likely heavier supplies.
MarketsFarm Pro analyst Mike Jubinville said he foresees new-crop prices above C$15/bu. That is down from current old-crop values ranging between about $19 and $23/bu but still an attractive price overall.
“If we throw challenged growing conditions into the mix, that could be a supportive feature for all commodities in general,” he said, noting the dry conditions that are continuing to plague large portions of Saskatchewan, the No. 1 Prairie flax producer, ahead of spring seeding.
Ag Canada is projecting that 2021 Canadian flax acres will increase 22% this year to 1.14 million acres, potentially the highest since 1.6 million acres were seeded in 2015. With the larger seeded area, and expectations for a slight increase in the average yield compared to a year earlier, production is forecast to increase to 675,000 tonnes from 578,000 in 2020 and 486,000 in 2019.
And while 2021-22 flax ending stocks are projected by Ag Canada to grow to 125,000 tonnes from just 50,000 for the current marketing year, Jubinville said he still fully expects ending stocks to instead remain below the 100,000-tonne mark.
For its part, Ag Canada is forecasting the average 2021-22 flax price at $16.50/bu, versus $18.15 in 2020-21.
Source: DePutter Publishing Ltd.
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