Crusher demand will test canola growers


Recently announced crushers will need another 4.6 million tonnes, but acres are maxed out and yields have not been rising

Canadian farmers need to produce an additional 4.6 million tonnes of canola per year starting in 2024.

That is a tall order, one that would require a 25 percent increase over last year’s output.

The 4.6 million tonnes are the amount of additional canola that will be required by three new crush facilities that will soon be under construction in Saskatchewan by Viterra, Cargill and Richardson.

If growers fall short of meeting that lofty production target, then something will have to give.

Either there will be less canola for Canada’s export customers or the new and existing Canadian crush plants will be duking it out for limited supplies.

Wilf Keller, one of the fathers of genetically modified canola and former president of Ag-West Bio, doubts there will be any more canola going in the ground in the coming years.

“We’re maxed out on acreage,” he said.

“I think it has to come from better management and better yields.”

Yields have been fairly stagnant over the past five years, with a national average of 41 bushels per acre.

The Canola Council of Canada has established a target of 52 bu. per acre by 2025.

But if anything, yields have been trending down of late from a record high of 42.3 bu. per acre in 2016.

Last year’s average was 40.1 bu. per acre, which is the same as it was in 2013 when the council established its Keep it Coming plan.

Assuming static acreage, the average yield would have to soar to 50 bu. per acre in three short years in order to generate an additional 4.6 million tonnes of production.

“I don’t think you can get that level of increase that quickly, in my experience,” said Keller.

Dave Kelner, canola portfolio manager with Bayer CropScience, declined to venture a guess where average yields will be in 2024.

However, he does know where the gains will come from, and it is not by pushing the top end yields into the 60 bu. per acre range.

It will come from providing more stability for underperforming areas of the Prairies where yields are languishing in the 30 to 35 bu. per acre range.

“It’s really about how you bring the bottom part of that performance bar up into the middle,” he said.

“I really think that’s where a lot of our opportunity has yet to come.”

Every year there are farmers harvesting canola fields that yield in excess of 50 bu. per acre, so the genetics are already there for high-performing crops, said Kelner.

However, the bar needs to be raised on the low end of the spectrum. That can be accomplished on the breeding side by providing better genetic tolerance to heat, drought and excess moisture.

“We tend to see all of those things now in the same year, it seems, in the different parts of the Prairies,” he said.

On the management side, there needs to be increased use of data analytics, widespread adoption of agronomy best management practices and increased implementation of precision agriculture tools.

“I don’t think, from an adoption standpoint, we have peaked at all,” said Kelner.

Keller said canola faces plenty of production challenges, including insects, diseases and drought.

He doubts farmers will be able to squeeze an additional nine bu. per acre out of the crop by 2024.

However, there will still be plenty of canola seed to satisfy the new plants. Farmers have produced an average of 20 million tonnes per year over the past five years.

An estimated 10.2 million tonnes of that was crushed domestically last year, with the remainder exported.

The crush will be closer to 15 million tonnes once the new plants are fully operational.

“It will move your crush level from 50 percent (of the crop), where it is now, to closer to 75 percent,” said Keller.

That means Canada may have to curtail its export program, at least temporarily.

Keller believes an average yield of 50 to 52 bu. per acre is eventually feasible, but it could take 10 years to get there.

“There’s a lot of innovation in that crop, and innovation will carry us further,” he said.

Kelner said demand from the new crush facilities is going to cause farmers to push their rotations even further than they are today.

That will encourage the evolution of new pathotypes for diseases such as blackleg and clubroot, which is why seed developers are going to continue to make disease resistance and management a key focus of their breeding programs.

He said it is a challenge, but a wonderful one, to be faced with because it stems from having more demand for the products that Bayer and other seed developers are producing.