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Canada’s Grain Outlook for 2024/25

13 June 20245 min reading

Canada remains a major player in global grain production, consistently ranking among the top producers and exporters of wheat, barley and canola. The USDA forecasts a 4.9% increase in Canada’s total grain production to 61.4 million metric tons. This growth is primarily driven by a significant increase in wheat production, which is expected to rise by 5.4% to 33.7 million metric tons, despite potential drought risks in the Prairie Provinces.

Canada stands as a cornerstone in global grain production, consistently ranking among the world’s top producers and exporters of key grains such as wheat, barley, and canola. This North American giant not only meets substantial domestic demand but also plays a critical role in feeding millions around the globe.

Canada’s vast and fertile prairies, stretching across Alberta, Saskatchewan, and Manitoba, are the heartland of its grain production. The nation’s climate, characterized by cold winters and warm summers, coupled with advanced agricultural practices, ensures high yields and excellent grain quality. 

Canada is renowned for its hard red spring wheat, known for its high protein content and superior milling and baking qualities. This makes it highly sought after in international markets. Used predominantly for livestock feed and brewing, Canadian barley is prized for its malting quality. The country’s barley production contributes significantly to the global beer industry. As the world’s largest exporter of canola, Canada leads in the production of canola oil, which is valued for its low saturated fat content and versatility in cooking and food processing.

Canada’s grain exports are crucial in sustaining global food security. With an efficient and reliable supply chain, Canada ships grains to over 120 countries worldwide. Asia, the Middle East, and Europe are among the largest markets for Canadian grains, highlighting the nation’s critical role in international trade.

The USDA’s Canada Grain and Feed Annual report for 2024/25 projects a promising yet challenging season for Canada’s grain industry. With a forecasted 4.9% increase in net total production of principal grains (wheat, durum, oats, barley, corn) to 61.4 million metric tons (MMT), Canada is poised to strengthen its role as a key global grain supplier. This growth is driven by increased wheat production and moderate gains in other commodities, despite environmental hurdles. “Across the Prairie Provinces (Alberta, Saskatchewan, and Manitoba) – where 92 percent of Canada’s total principal grain area is situated in Statistics Canada’s initial area intentions estimates – low snowpack combined with warm temperatures throughout the winter and lingering impacts from previous droughts create a risk of worsening drought intensity. In eastern Canada, soil moisture levels are satisfactory, and unseasonably early spring conditions may allow for early seeding,” the report noted. 

WHEAT PRODUCTION AND EXPORT DYNAMICS

Wheat remains the cornerstone of Canada’s grain sector. In the 2024/25 season, total wheat production is expected to rise by 5.4% to 33.7 MMT. This increase is attributed to improved yields and a slight uptick in the area planted. The Prairie Provinces (Alberta, Saskatchewan, and Manitoba), where most of the wheat is grown, are facing potential drought risks due to low snowpack and warm winter temperatures. However, wheat’s resilience to dry conditions could lead farmers to plant more, potentially surpassing initial planting estimates.

In the 2024/25 season, durum production is forecast to increase 36.0 percent to 5.5 MMT on a five percent increase in area planted and a recovery in yields. Durum yields sank to 1.70 MT per hectare in 2023 due to drought conditions and are assumed to return to a five-year average yield of 2.20 MT per hectare. Durum is expected to take up 23 percent of the total area planted to wheat, in line with historic averages. Durum area as a share of the total wheat area has been stable over the past ten years, ranging between 19 percent and 26 percent of the total wheat area, depending on prices. Durum is primarily grown in southern Saskatchewan, where soil and climate are typically most suitable.

Total wheat exports are projected to increase, driven by strong global demand and higher exportable supplies. Following 23.5 million tons of wheat exports in 2023/24, the USDA anticipates 24.7 million tons for 2024/25. Despite the potential for dry conditions impacting yields, Canada’s robust export infrastructure ensures it remains a reliable supplier.

CORN PRODUCTION 

Corn production in Canada is forecasted to grow by 2.4% to 15.4 MMT, supported by better yields and a slight increase in the area planted. The primary corn-growing regions of Ontario, Manitoba, and Quebec have stable corn-soybean rotations, contributing to consistent production levels. Improved forage and grazing supplies are expected to reduce corn imports from 3.3 million tons in 2023/24 to 2.3 million tons in 2024/25.

And corn exports are anticipated to decline to 1.7 million tons, reflecting reduced demand from the United States due to better-growing conditions there. Historically, Canada’s total corn exports, as a percentage of domestic production, rise as a result of drought years. This is because Canada’s droughts typically occur in the Prairie Provinces, and droughts that impact Canada’s prairies tend to also impact a share of the U.S. corn-growing region. In Canada, almost 90 percent of production is grown in Ontario and Quebec, regions prone to excess water more so than to dryness. In drought years, it is more economical for Ontario and Quebec corn to be exported to the United States and for Prairie Province feedlots to import corn from northern tier states.

BARLEY 

Statistics Canada’s area planted survey indicates that area planted to barley will decline three percent year-over-year. Industry states that low barley prices are deterring farmers from planting barley. USDA estimates that Canada will produce almost 9 million tons of barley in the new season. 

Canada is a net exporter of barley. Barley exports have experienced a slow pace in MY 2023/24 and are forecast to fall 26.9 percent over the previous year to 2.3 MMT, equating to 26 percent of production. Over the past five years, an average of 29 percent of barley production has been exported each year. USDA expects Canada to export 2.2 million tons of barley in the new season.

Canada’s grain outlook for 2024/25 is characterized by growth amid environmental uncertainties. With significant increases in wheat and moderate gains in corn and barley production, Canada continues to be a pivotal player in the global grain market. 

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