Canada Markets

Despite the significant carryout of grains in the 2013/14 crop year, inventory found in Western Division primary elevators of 2.576 million metric tonnes as of week 2 is just 7.9% above the five-year average of week 2 stocks (2009 through 2013). In three out of the five years -- 2009, 2010 and 2011 -- week 2 elevator primary elevator stocks were reported higher than the current level of stocks.

While current week 2 stocks are 64% above the week 2 stocks reported in 2013/14, stocks are well below the levels reported through much of last crop year due to slowdowns experienced in rail service. Over the 30 weeks from week 7 to week 36, the average primary elevator stocks on the prairies grew to 3.4 mmt, as noted by the trend in the red bars on the attached chart.

Despite concerns expressed over the winter that emphasis was placed on the closer to port supplies such as Alberta and Manitoba, week 2 inventories do not indicate this situation and indicate that Manitoba is carrying 20.2% of the western inventory, Saskatchewan is carrying 49.7%, Alberta has 29% of the inventory and British Columbia is carrying 1.1%. This is roughly the same distribution as seen in the 2013 report for the same week.

Eyes will be on railway performance as we move into the harvest period and their response to the shipping targets imposed by the federal government. Week 2 unloads at the ports on the west coast, Thunder Bay and Churchill totaled 679,800 metric tonnes, which is the lowest weekly movement in 17 weeks.

Cliff Jamieson can be reached at cliff.jamieson@dtn.com

Follow Cliff Jamieson on Twitter @CliffJamieson

(ES)

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