WESTERN PRODUCER — Statistics Canada’s mustard acreage estimate seems a little optimistic, according to a major processor.
It is forecasting 638,000 acres of the crop, a 15 percent increase over last year.
Scott Cunningham, general manager of Schlüter & Maack Canada, thinks a safer bet is around 600,000 acres, which is still a healthy increase over last year’s 555,000 acres.
He thinks the breakdown by class will be half yellow, 25 to 30 percent brown and the remainder oriental.
When processors started contracting new crop mustard in November 2022, bids for yellow and brown were in the $0.85 to $0.90 per pound range and Oriental was as high as $1.
Prices for all three have plummeted to the $0.60 to $0.65 range as farmers quickly locked up their projected production.
Cunningham is still getting a few calls a day looking to price new crop mustard.
A lot of new growers were lured in by coffee shop talk of last year’s sky-high prices that at times eclipsed $2 per pound.
Topsoil conditions are the best they have been in for four or five years in many the traditional mustard growing areas of Saskatchewan and Alberta.
“If we do get a crop with even an average yield, we’re going to have oversupply problems,” said Cunningham.
That could drive prices down to the $0.45 to $0.50 per lb. range, which while historically good would be bitterly disappointing to growers after two years of phenomenal prices.
However, subsoil moisture levels have not been replenished and there are conflicting reports about what type of weather El Nino will bring to the Prairies.
If it is another dry summer, then the mustard market will require all the 638,000 acres Statistics Canada is forecasting.
Russia and Ukraine are the other big mustard-exporting countries.
Cunningham said there is no information out of Ukraine, but there are reports that Russian farmers are increasing plantings of all three types of mustard.
Canadian old crop supplies are sufficient to carry processors through until this year’s harvest.
There is very little spot buying taking place, with exporters occasionally filling a container here or there.
Rayglen Commodities Inc. reports spot prices of $0.80 per lb. f.o.b. farm for yellow, $0.70 for brown and $0.68 to $0.70 for oriental.
In its May 3 market commentary, the firm said finding buyers for new crop is becoming a challenge.
New crop bids with an act of God clause, 10 bushels per acre, f.o.b. farm are $0.64 for yellow, $0.60 for brown and $0.65 for oriental.
Rayglen said there is no denying that seed sales were “exponentially higher” for the coming year, so acreage will be up.
And growers are reporting “excellent conditions” at seeding time, which has buyers feeling cautious.
Cunningham said new crop contracting is extremely quiet.
“Most of the guys have got their production bought and sales on the books,” he said.
Many farmers are not pleased with their marketing plans now that prices have collapsed.
Cunningham has heard reports that some buyers are trying to wiggle out of last year’s high-priced contracts.
Yellow mustard that was booked at $1.30 per lb. is selling for a fraction of that on the spot market.
Product has been getting rejected for not meeting the No. 1 grade specification over the past few weeks.
“A lot of that stuff that was contracted at higher levels is going to come back on the market here going into summer,” he said.
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