Canadian Wheat Production Expected to Rebound, Exports to Rise

Canada's wheat production is forecast to increase in the 2024/25 marketing year, driven by improved yields and a slight expansion in planted area, according to a report by the United States Department of Agriculture's Foreign Agricultural Service (FAS).

The FAS report projects total wheat production, encompassing spring wheat, winter wheat, and durum wheat, to reach 33.7 million metric tons (MMT), a 5.4% increase from the previous year. This optimistic outlook is based on Statistics Canada's initial area intentions data, five-year average yields, and FAS/Ottawa's forecast for winter wheat area remaining in the spring.

"FAS/Ottawa forecasts total wheat production (spring wheat, winter wheat, and durum wheat) to increase 5.4 percent from the previous year to 33.7 million metric tons (MMT) on improved yields and less than one percent increase in area planted," the report states.

Despite the positive forecast, the report acknowledges potential risks. Dry conditions in most wheat-growing regions, particularly in Alberta, could negatively impact yields if spring moisture is insufficient. Conversely, the drought may encourage farmers to plant more wheat than initially intended, as wheat is a drought-resilient crop.

Durum wheat production is expected to see a significant rebound, with the FAS forecasting a 36% increase to 5.5 MMT. This is attributed to a 5% increase in planted area and a recovery in yields following the drought-stricken 2023 season.

Canadian wheat exports are also projected to rise in the 2024/25 marketing year due to increased exportable supplies. The FAS forecasts exports to equate to more than 70% of annual production, driven by strong global demand.

"Wheat export levels in MY 2024/2025 will depend on area planted levels, yield, and production," the reports states. "However, [we are] currently forecasting exports to increase from the previous year, on increased exportable supplies."

While the outlook for Canadian wheat is generally positive, the report highlights concerns about ongoing drought conditions and their potential impact on future production. Significant precipitation will be needed to replenish depleted water resources and ensure sustainable wheat production in the long term.