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Since 1897, Olds Products, Leaders in MustardFitzpatrick Bros.

2018 Crop Reports

 

November 8, 2018

The mustard harvest of 2018 finally wrapped up last week!  Other than some drying to reduce seed moisture the mustard is suited for storage and ready for shipment.

Since my last report in late September, growers were very fortunate the weather warmed and the snow/rain ceased right through last week. This week looks and feels like winter across the prairies as temps are now below the freezing mark.

Starting in August, Olds Products had very good movement off farms for both yellow and brown mustard.  This prevented us from running too low in our cleaned mustard inventory. We have since brought our inventory levels to more comfortable levels but we expect that in December we will start another strong pull into the cleaning facility that will last through to July 2019. 

Harvest samples from our contract growers continue to come into our office for analysis and it looks like we will have a steady stream of No.1 quality mustard to clean in the crop year. That is not say that we do not have cleaning challenges. We have had to address higher levels of wild buckwheat and other black seeds such as canola and wild mustard. We have yet to see any evidence of damage caused by frost or rain/snow.

Yields for Canadian grown mustard in 2018 were effected by too little rain during key periods of the growing season. This is especially true for yellow mustard as the average yield struggled to reach 650 lb/acre in Alberta, and just under 600 lb/acre in Saskatchewan. In the USA (North Dakota and Montana) the average yield was just over 700 lb/acre. The average brown mustard yield was just under 900 lbs/acre in Saskatchewan.  It appears that brown mustard seed was the winner for growers when price and yield are both included in a gross revenue comparison. The actual average yield results for Olds Products' growers are below my earlier September estimate. I believe the industry yield will be close to our results.  Therefore, after a second year below the 10-year average yields for yellow mustard in Canada, some price pressure in the spot market could soon be revealed if even a bit of demand comes from Europe (where yields were also low). Spot grower bids in Canada and the USA have recently moved only slightly higher off the summer lows. But most buyers focus on buying their contracted mustard in the early months after harvest, as is the case for Olds Products.

Given the lower yellow yields in both Canada and USA, the outlook for 2019 will require an increase in industry acres.  This especially true in Canada where, unlike the USA, the yellow acres have drifted somewhat lower since 2016. Increases in acres are influenced partly by spot price levels and the next few months will tell the story. Even though mustard acres were higher in 2018 than 2017 the increases were almost entirely for Brown mustard. In Saskatchewan, where almost all of the brown mustard is grown, production could surpass yellow just like it did in 2011, which is remarkable. I would expect brown acres to decrease from the near-record-2018, but supply levels were zero this summer and so we will require a solid return of significant acres in 2019.

The Olds Products contracted organic acres reached a new high in 2018, and we expect more of the same in 2019. Yields in 2018 for organic yellow and brown were also affected by the hot and dry conditions in the growing period. Similar to our regular mustard ,the quality is also looking to be almost entirely No.1, but not without some normal cleaning challenges.

Olds Products will be out with our contract prices again in early January. I look forward to working with all of our past growers in 2019-20. We expect to have a small percentage of our 2019 brown acres to be seeded with a new hybrid that will be out for the first time for commercial production. I will report more as we receive the details regarding the availability of certified hybrid brown seed.

Regards,

Walter

September 21, 2018

After a great start in August, the mustard harvest continues but has slowed significantly. The weather the past few weeks has been mainly cool and damp. The forecast looks to improve next week as cloudy skies hopefully give way to sun. Temperatures may continue to be lower than normal but hopefully will not affect the ability to bring in the mustard. The estimated mustard harvest progress for Olds Products is at very much in line with the 80% completion estimate for all of Western Canada. Although only 20% remains in the fields it includes all of our organic acres and about 40% of the yellow contracted in Alberta. North Dakota and Montana are virtually done.

Early average yield estimates of pounds per acre for Olds Products are as follows:

Yellow

  • SK at 600
  • AB at 700
  • ND/MT at 800

Brown

  • SK at 1000

Given the lack of moisture in most growing areas this summer, especially in southwest SK, the yellow yields in Western Canada are no surprise and will be below the 5 year and 10 year averages. The interesting observation this year is the spread in yellow yields for each province and both states (MT and ND) from 300 lbs./acre to 1200 lbs./acre. Moisture had a lot to do with the yield spread but the seeding date also played a role. Brown Mustard proved again that it is more drought tolerant than Yellow or Oriental seeds. The spread in brown yields in SK, where almost all of brown seed is grown in North America, was 800 - 1500 lbs./acre.

Brown seed reserves were zero shortly before harvest began in August, but the market anticipated that a supply surge was coming and spot prices started to fall this summer. As a result of aggressive contract prices, seeded acres in SK for 2018 jumped 50% to over 125,000 acres. The possible supply from 2018 could be a record at over 60,000 MT while annual demand tops out at 40,000 MT. Although the difference appears large, most will be used by dealers and end users to replenish their inventory levels and avoid running out again in the near future.

Unlike brown mustard, the yellow acres in Canada did not move higher from the previous year. After a poor yield in 2017, and given the lower yields in the largest producing province of SK, the prospect for tightening reserves is very real. However, USA production was solid and the supply will help to mitigate some of the upward price pressure in Canada.

Based on early shipments and the harvest samples received thus far the quality of the 2018 mustard looks good and is no different from previous years for Olds Products.

Despite the current cool and damp conditions the soil moisture levels are very low in most mustard growing areas. Growers will need fall rain to take some of the pressure off the 2019 spring start.

Regards,

Walter

 

August 15, 2018

In late July I toured Canadian mustard fields.  The overall impression of the crops is mostly fair or below average in Saskatchewan, and better than average in Alberta. Reports from North Dakota, Manitoba and Montana suggest mustard crops are, at best, mostly good. All growing areas will be quite variable in yield due to the spotty nature of rains during the growing season. Mustard grown just a few miles apart can have significantly different outcomes depending on whether or not the field received a timely shower.

In early May, almost all areas experienced summer like heat that evaporated the top soil moisture very quickly. Most mustard fields in Alberta, North Dakota, and Montana received more than 3 inches of rain, whereas many fields in southwest Saskatchewan struggled to get even an inch of rain since May. All areas have received hot weather (30+C), but there have also been some cooler breaks that have allowed the plants some relief during the critical flowering stage.

In addition to lower yields from the dry, hot weather, many growers also had to deal with poor or uneven germination caused by the lack of soil moisture after seeding. This uneven germination usually results in higher dockage due to the higher weed pressure.

Our brown mustard is grown primarily in Saskatchewan and, despite the lack of rain, most of our contracted fields received some timely rains.  Additionally, due to the more drought tolerant nature of brown mustard compared to yellow, the yields should be average or good. Canada’s carryforward position from 2017 for brown is zero, therefore, all are pleased to see the progress of brown so far. Olds Products also increased our number of contracted acres to ensure we do not run out. The brown harvest will start as early as next week, and the industry numbers (Statistics Canada) in Canada are estimating a large increase in brown acres from 2017 with only slight increase in yellow.

The yellow mustard harvest started in Montana and Saskatchewan in early August. Initial comments indicate fewer bushels are being harvested than expected. Hot and dry weather this week will bring more growers to harvest, but more will start in the next week or two. 

Harvest sample information will be sent to growers shortly. Olds Products will continue, as in past years, to analyze representative samples before shipping orders are given. Please contact me when you complete your mustard harvest. That will allow me to start the plan to ship from farms. In addition to checking the samples for admixture and overall quality, Olds Products will also continue to send a portion of each harvest sample to the Canadian Grain Commission (CGC) for testing that includes oil and protein. The CGC provides an annual mustard quality report to all interested parties that includes results of all samples submitted by growers, dealers and processors. Thank you.

Regards,

Walter

June 20, 2018

Virtually all of Olds Products mustard production from 2017 will have been picked up by the end of this month and the result is that mustard stored on farms at the end of June is zero as it is most years. For the first time since 2012/13, Olds Products relied significantly on mustard production that was grown by non-contract growers (15%) in addition to the production from our 2017 contract growers. Their contribution was mostly from 2016 carryover when mustard yield averages were well above the 10 year average. 2017 had average yields well below the 10 year average and 40% below 2016.

In the hot and dry summer of 2017 the mustard plants drew heavily on the significant sub soil moisture built up from near record annual rainfall in 2016 but the record number of days with temps over 30C were too much to handle and 2017 yields suffered. The current forecast for 2018 is mainly hot and dry conditions to repeat through the growing season with the only relief coming in the form of showers and rain from storms in the main mustard growing areas. Storms have already hit parts of the prairies in Montana and Saskatchewan. The bad side of storms are wind and hail which have already taken a toll on some of our acres (1%).

Much of the mustard seeded in 2018 was seeded in May into drier top soil that needed rain to help germinate the mustard seeds. Most mustard growing areas received at least a small amount of rain but those areas that have received less than ½ inch are seeing uneven germination and the desperate need for more rain in the next 1-2 weeks. Some of the driest conditions are in southwest and west central Saskatchewan (SK) where most mustard is grown in that province. There are also dry mustard growing areas in Alberta, Montana and North Dakota but not as widespread as the dry area in SK. Timely showers in Alberta, Montana and North Dakota have brought the some of the mustard along nicely –especially in southern Alberta.

Spot markets have not reacted to the current situation due mainly to the lack of immediate and short term concern. Buyers and processors are relying on their current reserves in storage but this, at best, will only supply needs for a few months after the 2018 harvest.

The most immediate need later this year will be for brown mustard which is now sold out at the farm level. Brown acres in 2018 have jumped due to aggressive contracting programs that started in October/November of last year. Brown mustard is considered more drought tolerant than yellow mustard and the hope is we can get an average yield of 16 bu/acre (less than 10 year average) to cover demand for 2018/2019.

Yellow mustard acres in Canada and USA remained the same from 2017 but down almost 20% from 2016 when yellow spot prices reached near record highs.

My estimate for mustard acres in 2018 is:

Seed Region Acres Change from 2017
Yellow Alberta 100,000 ­up
Yellow Saskatchewan 125,000 down
Brown Saskatchewan 125,000 up +
Oriental Alberta - Saskatchewan 50,000 down +
Assorted ND-MT-ID-WA 70,000 up

Olds Products was aware of the potential supply shortage for 2018 and 2019 before we began our contracting program last January.  We knew, much like we try every year, we needed a contract price that almost all past Olds Products growers would accept along with 30% additional growers for 2018. The additional growers were needed to address our 2017 supply shortage due to lower yield, the higher possibility of another below average yield in 2018, and the increased demand from new business this year and next.

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

Regards,

Walter

April 27, 2018

I hope I am not jumping early but could it be that spring is sprung, finally? This week the last of the snow piles in Lethbridge should disappear and the typical city spring work will start. That is not the case in country where land is just starting to thaw and spring melt runs into low lying areas. It will be at least 2-3 weeks before work can start on the farms.  This will be at least a month behind the early starts in the last two years. The good news may be we will not have to worry about an early frost only because nothing will be up until the middle of May, at the earliest.

In 2016 there was a large, late spring acre grower response to yellow mustard due to the high spot prices at the time. The fundamentals (i.e. low stock use ratio) are not much different this year but spot price bids are not sending a message that more acres are needed. The late start to planting this spring does not favor mustard (compared to early seeding whereby avoiding the highest summer heat during flowering) and, unlike the conditions one year ago, the dry sub-soil moisture can rely only on spring rains.

I agree with predictions that from Ag Canada and USDA that mustard acres will be hard pressed to rally like they did in 2016 and therefore stay under 400,000 acres in Canada and around 70,000 acres in the USA (similar to 2017).

The 2018 mustard production contract program, that most mustard companies have, or are part of, had a very good start and early finish. The early contract start was first intended for brown mustard, which saw a jump in spot prices before the 2017 harvest, but soon included yellow after news that Western Europe may be coming to North America to buy after shortages were reported in Russia & Ukraine. Together with the surplus 2016 stocks of yellow mustard, it did not take long for the market to fill its requirements for end use customers in Canada, USA and Europe well into 2019. After that need was filled, and together with high inventory levels of yellow at mustard buyers silos’, it did not take long for spot mustard bids to drop again, but activity in the spot market is now very quiet as growers know the current on farm inventory of good quality yellow and brown mustard is very low.

Olds Products had a record number of acres that were contracted in 2018 due to increasing demand for all our mustard products, including organic. Our brown and yellow inventory levels will need a strong replenishment from our contract growers’ soon after harvest in 2018. The plan is to send harvest sample bags this summer along with instructions where to send them. I will plan a crop tour/inspection this summer and hope to cover most of our production areas in Alberta, Saskatchewan, Manitoba, North Dakota and Montana.

All the best to you for the 2018 growing season! Thank you.

Regards,

Walter