March 29, 2019

Market Developments

As we reported a couple of weeks ago, we’ve bumped up our 2019 mustard seeded area forecast by 50,000 acres, now at 425,000 acres. In particular, more recent firmness in the yellow mustard portion of the market is the key reason for our adjustment.
As a result, most of the change in our acreage total showed up in the yellow mustard category. In fact, yellow mustard area is now expected to be 260,000 acres, 5% more than in 2018. Meanwhile, brown mustard is expected to lose a good portion of the increase that occurred in 2018, back down to 100,000 acres while oriental will drop to a multiyear low of 65,000 acres.
Canadian mustard exports declined in December to 9,700 tonnes but that’s tracking the normal pattern very closely. That was also the third straight month of exports outperforming last year’s monthly totals. The year-to-date pace of 48,700 tonnes is ahead of last year at 46,300 tonnes but is slightly trailing the 10-year average of 50,400 tonnes.
These solid volumes in December have made achieving our full-year forecast of 115,000 tonnes more likely, although the January data is expected to show a dip to a seasonal low.
Russian mustard exports have dropped off significantly since peaking in October at 10,200 tonnes.
Since then, Russian volumes have declined but those have largely been offset by increased mustard availability from Kazakhstan. We’re still waiting on January data from Ukraine and Kazakhstan and expect they will be somewhat reduced, showing overall declines in Black Sea exports.

Outlook

Yellow mustard bids are remaining firm as better-than-expected export demand is giving that portion of the market a small lift. Reluctant farmer selling is also providing some support. Meanwhile, brown and oriental mustard continue to struggle under lacklustre demand and more-than-adequate supplies. Expected acreage shifts for 2019 should help to restore more balance for the various classes, eventually bringing brown and oriental prices closer in line with yellow.