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Since 1897, Olds Products, Leaders in MustardFitzpatrick Bros.

2009 Crop Reports

December 15, 2009

I would like to provide you with an update on our mustard program as we near the end of December. Mustard shipments from farm to cleaning plant in Drayton (Weinlaeder) are  30% complete based on total production from Olds Products contracted growers in Alberta, Saskatchewan and North Dakota (40% complete based on contracted production). Shipments ex farm will start again in the 3rd week of January from all areas and the pace will be strong to meet the demand for cleaned No.1 mustard.

Cleaned shipments of mustard to the Olds processing plant in Pleasant Prairie, Wi. (as well as to our other customers) has been very steady since we started up in October. We are expecting stronger shipments from January through May 2010- the busy season for making bottle mustard. 

I have been sending delivery tickets following the arrival of each load at Weinlaeder- usually the day after arrival. The delivery tickets are sent to each grower and also to my office for processing and payment. The goal is to have the every ticket paid within one week and then to mail the USD checks from Pleasant Prairie promptly. The Canadian checks are couriered to my address in Canada and then mailed promptly.

I would like to wish you a Merry Christmas and a Happy New Year. It has been my pleasure working with you and I look forward to continuing for many years to come.

Walter Dyck

November 29,2009

Crop Report Highlights

  • The mustard harvest across Alberta, Saskatchewan and North Dakota is finally complete.
  • Spot mustard bids to growers have rebounded in November from October lows.
  • ‘09 quality is very good despite weather challenges through out the growing season
  • ‘09 yield is well above 10 year average yield.


Details

The mustard harvested in November (20% of total) appears to have escaped significant grading issues. We are currently awaiting the last of the harvest samples (approx 70% of the samples have been checked thus far) at the office in Pleasant Prairie. Some of this late harvested yellow mustard has a white color called rhyme damage. Cold temperatures prior to full ripening will cause the mucilage in the seed to move to the seed coat and change the coat to a white color. This color has little effect on the mustard in the manufacturing process and the grading guidelines allow for 1.5 % maximum damage in a No.1. The seed coat must be entirely covered in white color before it is counted as damage. Brown and oriental mustard have much lower mucilage levels than yellow and therefore rhyme damage is not a factor.

Moisture levels in the mustard delivered to our cleaning facility has ranged from 7 to 9% and many growers are taking added measures this year to ensure the mustard is below 9.5%. These measures include aeration in bins, moving the mustard from bin to bin, and drying using a batch dryer. Above seasonal temperatures in November have allowed bin aeration to be effective.

Spot mustard grower bids have moved back to the high twenties for yellow and mid twenties for brown and oriental but few spot trades have taken place. In my earlier reports I estimated that as much as half the 09 seeded acres of mustard (250,000 spot acres of which 70% was yellow and 20% brown) was grown without a contract and to a large extent these are the acres that will influence spot pricing levels in 2010. The spot mustard market is influenced by grower cash flow, spot demand from Europe, outlook for 2010, 2009 crop yield, available bin storage, and carry- forward levels from 2009. My comments are:

  • light post harvest selling in response to 12 month low bid levels in October
  • light demand in North America for spot mustard but this is expected to increase in December
  • spot demand from Europe for North American yellow mustard has been low due to good mustard supplies in Eastern Europe and the Ukraine
  • 2010 contract pricing will have to be competitive for acres as 2009 carry-forward stocks will last until December 2010


Contracted mustard is moving well into our cleaning plant and we have received 20% of our annual contracted mustard thus far from growers. We expect the coming months to be very busy for shipments.

Reported yields from Olds Products contracted growers for 2009 are as follows:

Alberta

  • Range- Yellow 0 lbs/acre (drought) to 1525 lbs/acre, Brown 0 lbs/acre (drought) to 1500 lbs/acre
  • Average- Yellow 750 lbs/acre, Brown 700 lbs/acre

Saskatchewan

  • Range- Yellow 400 lbs/acre to 1575 lbs/acre, Brown 600 lbs/acre to 1500 lbs/acre
  • Average-Yellow 850 lbs/acre,  Brown 800 lbs/acre

North Dakota

  • Range- Yellow 480 lbs/acre to 1790 lbs/acre
  • Average- 950 lbs/

October 22, 2009

Since my last crop report (Sep 29) the weather took a big turn towards cold and wet. Harvesting was shut down and almost 25% of the yellow mustard crop (10-15% for brown and oriental) remains in the fields awaiting dry conditions. As good as September was for dry warm weather, October has been anything but.

The good news is that the yellow mustard remaining to harvest is:

  • relatively very good at not shelling
  • is standing (vs. lying down in a swath) which means it will dry down fast when the weather improves
  • mature and therefore green seed is not an issue
  • mature and should not lose quality in the cold weather

Farming is a gamble in these challenging conditions -  especially this year with the much higher cost of production. Do you take it off wet and hope you can dry it down to safe moisture levels or do you wait and risk not having your mustard under storage before the snow flies?

After Ag Canada improved the yield outlook for mustard in their last report the price bid for yellow mustard by brokers and dealers fell from 40 cents/lb (CDN$FOB Farm) in August to 30cents/lb (brown and oriental has fallen to the low 20’s) in early October. There must have been some trades at this level because bids from brokers and dealers fell to 25 cents/lb last week. At this time the market (all parties) is gathering information about the mustard harvest and it will decide if spot yellow prices can be sustained at 25 cents/lb. If growers see value in selling at 25 cents/lb then that will be the level. Contract prices for 2010 will be out in several months and it appears now that values will have to be in the low 30’s to get the contract acres. In most years the spot price for mustard to the grower will approach the contract price for mustard unless there is a shortage in which case the spot price will pay a premium to new crop. I believe the best opportunities to sell excess or spot 2009 mustard will be in 2010 when more buyers (end users) show interest.

Pricing in USD for buyers has changed very little from the spring and summer months as the drop in spot prices was offset by the stronger CDN$. We will have to see how the recent drop in spot prices affects offers to manufacturers.

September 29, 2009

Mustard harvest continues to move along at a great pace (close to 80% complete) after another week of hot dry conditions over most of the mustard growing area in Canada and North Dakota. More warm dry weather is needed for the next two weeks to bring in the remaining 20%.  Mustard yields and quality have responded to the excellent September weather and this has reduced spot yellow bids to growers to 30 cents/lb (CDN$) FOB Farm from 40 cents/lb- a level that held for most of the 2009 summer. Brown mustard demand in the spot market has fallen this year due to higher supplies from 2008 and also from the improved yield picture this year.

A bit of a tug of war will occur after harvest this year when the spot market determines what basis level (FOB Farm Price) spot growers sell and at what basis level spot buyers buy. There is very little immediate requirement at this time from end use customers for spot mustard but they are very interested to look at any opportunities to possibly lock in now for what they will need in 2010.  The 2009/10 spot market will be approximately 50% of the total supply (approx 250,000 acres in Canada/USA were not contracted) and 30-40% of the total 2010 demand (annual demand is 150,000 MT). In total Canada/USA has enough mustard production in 2009 to supply traditional mustard markets into early 2011 and this reflects a healthy balance between demand and supply. We will still need a strong 2010 contract price for mustard to bring another 500,000 mustard acres into production next year to meet customers’ requirements for 2011.

Olds Contract Growers

The higher yield outlook in September has put more pressure on farm storage. Olds Products will have a strong shipping season for mustard and we are excited to start. It is my plan to balance shipments fairly among contract growers over the contract term. Yellow mustard shipments from farms will begin in Sept/Oct 09 and brown shipments will begin Oct/Nov 09. I look forward to discussing your shipping schedule with you in October/November. Please let me know (by email or phone) when you send your harvest samples and let me know your production estimate as soon as your harvest is complete. I plan to be in Pleasant Prairie, Wi. to look at harvest samples in the week of October 12.

Please let me know if you have any questions or comments.

September 15, 2009

September has been close to perfect for maturing this year’s late mustard crop. Warm and dry weather is again prevailing this week over the mustard growing areas in Canada/North Dakota and this will push the harvest completion for mustard to over 50% by weeks end. Another week of warm dry weather will push the completion to over 80% in Alberta, Saskatchewan and North Dakota.

Yields vary widely by area and also widely within the area. Rain started to fall later than usual this year and this favored the later seeded mustard- who would have known? Hardest hit areas by drought are in Eastern Central Alberta and Western Central Alberta where yields range from 0 to 600 lbs/acre. Some of the best yielding areas are in North Dakota and Saskatchewan (central and southeastern) where yields will range from 800 to 1200 lb/acre. I estimate average yellow yields in North Dakota will be the highest- 1000 lb/acre, followed by Saskatchewan at 700 lb/acre and Alberta at 600 lb/acre.  Brown and Oriental yields in Canada will be 10% -15% higher than yellow yields which is normal. Loss due to hail affected only a few of the Olds mustard growers this year.

The September weather has greatly improved the expected overall quality of this year’s crop.  Mustard markets in July and August were expecting higher proportions of No.3 and No.4 qualities-account of damage from a late August/early September frost (has not happened yet and the effects now would be minimal due to the maturity of the crop- see pictures attached). The combination of the improved quality and yield outlook has lowered spot bids to growers in the last month. Yellow mustard bids to growers (FOB Farm) range from 32 to 35 cents/lb in Canada (30-32 cents/lb in the USA) and 25-27 cents/lb for Brown. At this busy harvest time very few new crop mustard trades have occurred. The next important step is whether spot buyer’s will step forward and cover their requirements for 2010 at these levels. It appears that Europe had a decent crop of yellow mustard and therefore they will not be urgently looking to buy as was the case in the previous two years. Bottom line – there is little urgency but spot buyers will be looking in the next few months to cover a portion of their 2010 requirements.

If average 2009 mustard yields in Canada hold up to Ag Canada predictions of 840 lb/acre then the supply of mustard in Canada (assuming 540,000 acres in Canada) will cover annual demand through December 2010. Although this seems like a large carryout (3-4 months supply after harvest 2010) it will still require a very competitive contract price for mustard next January when contract growers consider what they will plant in 2010 and contract buyers consider when they will buy for 2011.

I will be looking at harvest samples (sent by Olds mustard growers) in early October at our Pleasant Prairie location. Reports from Olds mustard growers thus far include:

  • Large seed size due to mustard variety (Andante)- if black seeds are present they will clean out with less mustard loss
  • Low dockage (5-10%) however isolated fields have higher weeds due to herbicide failure (caused by early season cold and dry conditions)
  • No.1 quality

Olds Products mustard growers grew only Andante Yellow (superior variety) and only Centennial Brown (superior variety) in 2009. I believe identity preserved varieties is the future for mustard manufacturing but this is much easier said than done.

 

August 24, 2009

The mustard harvest has begun in Southern Alberta and in Southern Saskatchewan but only on several farms. Most of the mustard harvest is still one to two weeks out from maturity. Warm weather is forecast for much of the mustard growing area this week and this will speed the ripening of the mustard plants as they begin to drop leaves and turn color (see attached).

Harvest sample bags have been sent to all Olds Products contract growers. The harvest samples will be analyzed by me and other Olds Products staff at the Pleasant Prairie, Wisconsin facility.

With the recent rain that was received and the lateness of the season, it is very likely that the mustard harvested will be on average significantly higher in moisture than recent years. Please make sure your moisture is less than 9% before you store your mustard for any length of period. The consequence of wet mustard is heated mustard and the tolerance is extremely low for No.1- No.4 grades. We have no markets for heated mustard.

Statistics Canada released their late August crop estimate and they raised expected yields in Canada for 2009 mustard by a whopping 25% to over 840 gross lbs/acre (40,000 metric tonne increase-roughly 3-4 months supply of yellow, brown and oriental). The increase is likely a response to the very good late season harvest weather that we may get and the fact that no frost has been received thus far in August. At the very least the raised yield estimate may reduce spot bids to growers in the short term as the market prepares for the end of the mustard harvest when more will be known about yield and quality. As I said in my previous report the demand will be good for spot mustard through 2010 but the recent report from Stat Canada may delay buying interest in new crop spot mustard.

Please let me know if you have any questions or comments.

August 13, 2009

Cooler wet weather is in the forecast through the weekend in much of the mustard growing area of Alberta, Saskatchewan and North Dakota. The rain should be of some benefit as most of the mustard has now finished blooming (see attached pictures) and pods are filling. Most of the mustard fields are now in the final 2-4 weeks before harvest and warm dry weather is needed to bring the plant to the harvest stage. Prospects are good to very good in most mustard growing areas with the exception of eastern Alberta and western Saskatchewan.

The spot mustard market remains very thinly traded due to the lack of inventory in growers’ bins. Spot and contract prices are holding up this summer and I believe 2009 and 2010 will be a grower’s market. By this I mean that spot mustard prices will not drop significantly and this will keep contract prices high for 2010. I believe 60 %( normally closer to 80%) of the 2009 mustard crop (to be used primarily in 2010) has been sold through the supply chain (i.e. contract grower, dealer and contract buyer). The remaining 40% will have to cover their requirements in the next 12 months.

Please let me know how your mustard crop is doing at this time. Thank you.  See important information below you will need to know as we move towards harvest, shipping and payment:


Dry Mustard

For yellow mustard (straight combined) the maximum moisture for the seeds at harvest is 9%. Higher moisture levels (over 9%) will result in bin heating and likely loss of the entire value of the mustard. Even the slight smell of heating caused by a few seeds can reduce the grade of mustard. Bin aeration can be of some benefit in drying down the mustard but frequent monitoring is required. Drying mustard using dryers may also be an option but experience is needed as mustard can release a flavor enzyme when a minimum high temperature is reached causing heating.  I realize that harvest pressure will be higher than normal due the late start this year for all mustard growing areas but you have to realize the importance of quality in mustard markets. Virtually all mustard is an ingredient in foods used for human consumption.

Cleaning

Olds Products is pleased to be using a cleaning plant (Weinlaeder) in Drayton, North Dakota to clean and store 100% of the mustard we have contracted. Weinlaeder Seed Co. (see attached picture #2009 040) has been cleaning mustard for over 15 years. It has a very modern facility with an experienced and reputable staff. We look forward to a continued great relationship with Weinlaeder.

Shipping

It is my goal to bring all contracted mustard before the contract deadline and to be equally fair to all contracted growers. If some growers receive early shipment orders then they will likely also have some later orders.  Growers who do not receive early orders can expect to receive their orders near the middle part of the term. Our usage for mustard is year round but we will build up inventories prior to January to minimize farm shipments in the coldest part of the winter and to prepare for our very busy spring/summer

Security

It is our plan to use seals (hoppers and tarps) for all shipments from farms. Trucker’s will supply the seals but it is your responsibility to write the numbers on the B/L with your signature. The cleaning plant is not authorized to unload a truck without seals nor a truck with seals that do not match the B/L seal numbers.

Harvest Samples

After harvest, at your earliest convenience, please mail us a representative sample of the mustard you have grown for us. Sample bags are being mailed to you this week with further mailing instructions included. Please take the sample while you are filling your bins rather than after the bins are full. Mustard, dockage and other foreign material will tend to separate in the bin during storage and samples taken after the bins are full are of less value. We learn a lot about the crop from representative samples that you supply. Our analysis will include seed weight, seed size, color, grade, oil, protein etc. Although we place importance on the sample you send us it is not used to determine your grade and dockage on delivery. The grade and dockage is determined solely by the representative sample that is taken from each truck for every shipment.

Payment

It is our goal to have payment received by the grower within two weeks of shipment. In order to achieve this we will only issue cash payments (no deferrals) to the contract name on the contract. Please check your contracts and let me know if any changes are required.  It is not our intention to offer split payments.

 

July 29, 2009

In the last few weeks I toured many encouraging mustard fields in Alberta, Saskatchewan and North Dakota. Many of these fields are in an extended bloom period (3-4 weeks) and with a bit of additional rain these added blooms should hold on (not fall off) and form more seed filled pods at the top of the plant. The pods that are formed (bottom to middle) contained 3-5 seeds per row (yellow) which is a very good yield range.  Harvest for most of the mustard fields is 3-5 weeks out. A pressing issue for some mustard growers (5%), due to either the June frost or lack of moisture after seeding, is the second and possible third staged growth in their fields. The later growth will quicken its development with the decreasing daylight and will be ready for the harvest- along with the first growth. It is not necessary to use a desiccant for mustard, nor is one registered for harvest use.

Warm and dry conditions have prevailed over the past two weeks and this will hasten maturity in all mustard growing areas. More warm dry weather is in the forecast.

Approximately half of the 2009 mustard crop (total acres for Canada/USA as per government agencies is 600,000 acres- my guess is 400,000-450,000 yellow, 75,000-100,000 brown and 50,000 oriental) is not contracted and spot prices will largely depend on how motivated the spot growers are to part with their mustard. The carry-forward surplus from this year’s crop will be low which means supply will only slightly outstretch demand and this should keep prices from falling from current levels- CDN FOB Farm 37-40 cents/lb for yellow, 28-32 cents/lb for brown and 30+ cents/lb for oriental. However it will be interesting to see the effect on spot mustard prices if other commodity prices fall further.

Despite the cold late start this spring the mustard fields under contract to Olds are largely very clean of weeds and the insect pressure (flea beetles and grasshoppers) has been minimal.

Olds Products is committed to the Andante (Yellow) and Centennial (Brown) varieties and our supply of certified mustard that we growing for our 2010 contract program is progressing very well.  Below is a picture from three from Swift Current, Saskatchewan.  The results should be very good.

On Friday I will visit some of the more challenged mustard growing areas (due to a lack of moisture) in central Alberta and eastern Saskatchewan. Please let me know if you have any questions or comments.


I recently provided a mustard market review in Swift Current to a group that included researchers, growers, end-users and dealers. The market review was picked up by the Western Producer- July 23 edition.  Click here to read the article.

 

July 14, 2009

I took pictures of a 300 acre yellow mustard field in Southern Alberta in the rain today and what a difference two weeks makes. The yellow mustard is in full bloom, the stand is even and 3 feet tall.  The rain received in Southern Alberta the last month is now close to 4 inches and combined with the experienced management of the grower this crop now looks terrific. The mustard will bloom for several more weeks and then pods will begin to form from the flowers.

Saskatchewan and North Dakota also received rain in the last week and crops there have also benefited but not to the extent hoped for in Central Alberta and Western Saskatchewan where it seems to be too little too late. The management of an experienced successful mustard grower should never be taken lightly and even mustard crops with little or no rain can achieve a decent yield.

Spot mustard prices remain firm but are not rising after the three weeks of timely rains. Yellow bids are in the high 30’s (CDN $ FOB Farm) and the brown in the high 20’s but activity is very low due to low inventories at the grower level.

 

June 28, 2009

Below is a picture of the same field in Souther Alberta.  The development of the plants had been significant in the last week.  The ground is almost completely covered and that will help keep the weeds back.  The next stage of develpment for each plant will be a move upwards from the main stem.

June 22, 2009

Most of the mustard growing area in Alberta, Saskatchewan and North Dakota was seeded in the last two weeks of May (2-4 weeks later than normal) this year due to cool conditions. The cool weather continued until early June and then much of the mustard growing area had several degrees of frost for several hours each day for 3-5 successive days. Mustard in known to be relatively frost tolerant and only a small percentage had to be re-seeded. Shortly after the frosty days the weather warmed and the next thing we badly needed in large parts of Alberta and Saskatchewan was rain. The rain arrived this weekend and for some areas it was the first real rain of spring ‘09.

The recent rain is a life saver (more expected this week) for western area crops in Saskatchewan and also for crops in Central Alberta. Mustard in these areas has spotty germination and potential yields will be less than normal. Our acres in Eastern/Central/Southern Saskatchewan, Southern Alberta and also those in North Dakota are doing well- but they are also behind normal development at this time. Some of the acres are now blooming and that is encouraging to see before the July heat arrives. I will do some crop inspecting in early August and report again.

Mustard prices have moved sharply higher in both spot (farm inventory levels are low) and new crop contract markets in June. The rain will temporarily halt the climb but mustard will remain very sensitive to weather until harvest. Some mustard market watchers are not confident of the number of acres that Ag Canada has reported in its survey. The more common belief is that 450,000-500,000 acres was seeded in Canada rather than 550,000 reported by Ag Canada. In any event, I believe roughly half of these acres were contracted (the other half are spot acres whose production is not contracted with a buyer) and only 10-15% are brown (50,000-70,000 acres) and even less oriental (25,000-40,000 acres).

In the USA (North Dakota/Montana/Washington) mustard acres are reported at 55,000 (70,000 in 2008) and they are mostly all yellow acres.

The expected mustard harvest in ’09 for Canada/USA should be only slightly higher than the demand for the crop in 2010 (10-20% higher supply based on less than normal/average yields due to the late start). If Europe has a yellow shortage due to weather problems in the Ukraine (where a significant amount of Europe’s mustard is grown) prices for yellow and brown will jump higher in October and even without a shortage in Europe mustard prices will be firm as long as grower cash flow is positive.

 

Southern Alberta - Yellow Mustard - June 2009