Already small 2021 Canadian crops are likely to be revised even lower when Statistics Canada releases its final crop production report of the season on Friday.
Prior reports in September and August were compiled using satellite imagery, with the December report the first of the year to utilize farmer surveys.
While Statistics Canada has made greater use of satellite imagery and model-based estimates in recent years, the technology is still relatively new and the potential for discrepancies could lead to some surprises in the Dec. 3 estimates, according to market watchers.
“There a high level of uncertainty," said Ken Ball, of PI Financial in Winnipeg. “There’s the potential here for some surprises to pop up."
Mike Jubinville of MarketsFarm Pro agreed, noting the previous satellite reports likely didn't fully account for this year’s drought, with factors such as pod filling, field abandonment, and how much was cut for green feed not fully reflected.
"I suspect, if anything, it will be lower numbers," Jubinville said, adding that the extent of the downgrade remains to be seen especially given anecdotal reports from some farmers of better-than-expected spring wheat yields.
"Yields might be a little higher for some crops, but overall production will be down because they'll have a higher abandonment rate," said commodity analyst and Winnipeg-based trader Jerry Klassen.
While the general consensus is for smaller production from the September report, Ball said some of the grains may end up a bit better than earlier thought.Click here to see more...