Canada to Become a Major Global Supplier of Wheat in Early 2023

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Canada’s wheat production reaches record highs, putting the country on track to become a significant global supplier of wheat in 2023. This was due to low supply prospects for critical markets such as Argentina, the US, and the EU.

According to Statistics Canada, the country is predicted to harvest 33.8 million mt of wheat in the marketing year 2022–23 (August–July), which is a 51.5% increase from the previous year. 

“The primary reason for the increase in area under the crop was the attractive prices amid supply constraints during the sowing season,” a trader based in Vancouver said.

The larger harvest is expected to produce more wheat exports from Canada this year. Agriculture and Agri-Food Canada estimates that the country’s wheat exports increased from 15.1 million mt to 23.5 million mt in MY 2022–23.

“With China relaxing the ‘zero-COVID’ policy, there is the likelihood that it may keep on purchasing wheat from Canada,” according to a trader with a global corporation with headquarters in Singapore.

Canada may also expand supplies to South American and Asian countries due to the decline in Argentine production.

Despite the positive expectation for Canada’s wheat yield, certain regions have reservations about the harvest. Due to dry weather in several areas of the Prairies region, Statistics Canada reduced its forecast for wheat yield by over 1 million mt. However, the outlook for Canada’s overall wheat exports is not anticipated to be significantly affected by this.

In addition, Canada’s wheat may face rivalry in the global supply markets as Russia supplies wheat in various regions at lower prices.  

According to Chuck Russel, an Alberta-based trader, “Russia is suffering a glut as supply stalled amid its big crop, so it is seeking to dump its wheat at reduced prices. This might give Canadian wheat a hard competition.”

Despite reaching record highs in wheat production, the country might face increasing competition from other global suppliers and the possibility of market fluctuations over the next year.

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