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Canadian Farmers Will Plant Less Wheat, Canola This Season

April 24 (Bloomberg) -- Wheat growers in Canada, the world’s biggest exporter after the U.S., are planning to decrease seeding by 4.8 percent this year and also reduce canola planting, a government report showed.

Farmers may sow 24.8 million acres of the grain, down from 26.0 million a year earlier, Statistics Canada said today in Ottawa. The average estimate of 12 analysts surveyed by Bloomberg News was 24.3 million acres. Canola seeding may fall 0.7 percent to 19.8 million acres. That compares with 20.75 million acres forecast by analysts.

Seeding is declining after record crops last year spurred price declines and placed unprecedented pressure on rail lines that handle 95 percent of Canada’s output. The backlog left as much as C$20 billion ($18 billion) of crops stuck on prairie farms, and prompted the government to order railways to increase grain shipments or face penalties of as much as C$100,000 per day.

Statistics Canada said it interviewed about 11,500 farmers between March 24 and March 31 about their planting intentions. Net returns for canola are higher than wheat and farmers historically underestimate how much they will plant early in the season, David Reimann, a market analyst with Cargill Limited in Winnipeg, said in a telephone interview.

“I would not be surprised if we saw it at least marginally larger by the time we’re all said and done,” Reimann said.

Spring Wheat

Spring-wheat planting may fall 5.6 percent to 18.0 million acres, while durum seeding is forecast to drop 2.6 percent and winter wheat will decline 2.7 percent, the report showed. Barley acreage is forecast to drop 11 percent, while soybean planting may increase 16 percent to a record 5.26 million acres.

Delays moving last season’s crop for export are discouraging farmers from planting more, and transportation and delivery options “will be critical factors” in seeding decisions, the U.S. Department of Agriculture said in a April 2 report.

Planting of dry, field peas may jump 21 percent to 3.98 million acre, while lentil seeding may climb 20 percent.

“Burdensome” inventories of wheat and canola are prompting growers to shift to smaller crops, John Duvenaud, publisher of Wild Oats Market Advisory, said today in a conference call.

To contact the reporter on this story: Jen Skerritt in Winnipeg at jskerritt1@bloomberg.net

To contact the editors responsible for this story: Millie Munshi at mmunshi@bloomberg.net; Joe Richter at jrichter1@bloomberg.net Joe Richter

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