Big yields, imports ease supply concerns for U.S. canola crushers

Wed Oct 2, 2013 2:25pm EDT
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By Rod Nickel

WINNIPEG, Manitoba Oct 2 (Reuters) - Big canola yields in the northern Plains have eased earlier supply concerns for U.S. processors, who also look to tap a bin-busting harvest in Western Canada.

U.S. farmers planted 1.3 million acres of canola in 2013, but unfavorable weather prevented them planting the crop on 426,711 acres, according to U.S. Department of Agriculture Farm Services Agency data. A year earlier, under better conditions, they planted 1.7 million acres of canola, and were unable to plant on only 6,000.

Yields in North Dakota, however, look to make up for lost acres after favorable summer weather, industry officials say.

"We were a little concerned early in the crop year because the acres were disappointing," said Neil Juhnke, chief operating officer of Northstar Agri Industries, which runs a canola-crushing plant at Hallock, Minnesota. "But the yields we're seeing around the plant and in the core of the North Dakota canola-growing region have just been spectacular.

"We think there's about the same amount of canola available this year as there was last year."

Juhnke said yields ranged in the main North Dakota canola-growing area from 50 to 70 bushels per acre, about double the usual yield.

U.S. farmers are a small producer of canola, which is used mainly for vegetable oil in food processing and as a protein source in livestock rations. But U.S. plantings in the shadow of No. 1 grower Canada have crept higher in the past decade and the yellow-flowering oilseed has proven to be a useful rotation crop from winter wheat in Oklahoma, southern Kansas and north Texas, as well as a profitable summer crop option in northern states.

Crushers like Legumex Walker Inc are counting on farmers' fondness for canola growing. The Canadian processor of legume crops like peas and lentils opened a canola-crushing plant in Warden, Washington late last year, well away from the main U.S. canola-growing states.   Continued...