June 7, 2019

Market Developments

  • While Canadian mustard supplies are usually somewhat underreported, we’re looking ahead to roughly steady supplies (at least from an overall perspective) in 2019/20 of 215,000 tonnes. For individual classes however, supplies will vary next year. Carryover from 2018/19 isn’t expected to change all that much, although it will consist of more brown and oriental mustard and less yellow.
  • We’re forecasting seeded acreage will shift toward yellow and out of both brown and oriental. If so, it would leave yellow mustard supplies next year relatively steady. Meanwhile, the smaller brown and oriental crops would still be partly offset by a sizable old-crop carryover, leaving supplies lower than last year but still fairly comfortable.
  • As of June 3, Saskatchewan farmers had planted 92% of expected mustard area. This is ahead of the 5-year average of 81% complete. Since the Sask Ag report, most of the remaining acres would have been planted. The lack of rainfall has allowed rapid planting progress but rainfall earlier in the season in southwest Saskatchewan and southeast Alberta where mustard acres are concentrated is still providing a decent start to the growing season.
  • Russian mustard exports had spiked earlier in 2018/19 but through the winter months have been closer to 2017/18 levels. In March, Russia exported 3,500 tonnes, with Bangladesh the largest buyer, followed by Poland and Germany. The year-to-date pace is 51,100 tonnes, still well ahead of last year at 39,300 tonnes. And if the 2018 production estimate of 200,000 tonnes is any indication, it means a very large carryover into 2019/20 is likely, although the quality may not be the best.
  • So far, mustard bids are showing that there’s no real concern about prospects for the 2019 crop. Both old-crop and new-crop prices remain flat or, in the case of brown mustard, slightly weaker. These bids also reflect the more comfortable supplies of brown and oriental mustard while yellow isn’t looking quite as plentiful and a seasonal bump is still possible.

Outlook

There’s not much movement expected for mustard bids in the short-term aside from a bit of possible seasonal strength for yellow. Most acreage of Canadian mustard is outside of the driest areas, limiting yield concerns for now. The most likely price direction heading into 2019/20 is steady for yellows with a couple of cents upside for brown and oriental later on in the marketing year.