Canola price skyrockets at $16.25 per bushel

Local canola producers are relishing the moment as the current price of canola has been driven up to a whopping $16.25 per bushel. This price is listed for a June 2021 delivery within a 45 minute range of Mannville.

Compared to where it used to be, Scott Konieczny, canola farmer and co-owner of Konieczny Seeds in Mannville, said last fall the canola price was closer to $11 per bushel, and it stayed between $10-$11 for the last few years.

“When I was a child I remember my dad being super happy when it hit $8 per bushel,” said Konieczny.

“I’d love for that canola price to be up there all the time, but I also know that is kind of unrealistic. I’d be happy if they just stay for a little while.”

Because you can hedge ahead in grain commodities, if producers think the market is going to go up or down, they can sell their next season’s crop by locking in the price ahead of time. Konieczny said usually the ‘new crop’ price is significantly lower, but the canola price for a September – October delivery is currently $12.70 a bushel (the ‘old crop’ price, which every one has in their bins, is the $16.25).

“The new crop price is already being affected because that’s usually closer to what a guy actually budgets for,” said Konieczny.

Danny Farkash, owner of Noralta Farms Ltd., doesn’t farm canola and said he isn’t sure why but it seems that right now, China is buying up everything – not just canola. He said just last week he dropped off a load of metal scraps to be recycled in Edmonton and the price for those had gone up as well.

“It seems like most of the commodities are very high and going up. We’re not sure why other than that it seems like China is buying it up,” said Farkash.

Konieczny said he thinks part of the canola market being so high is that in Europe they banned a seed treatment called a Neonicotinoid (an insecticide).

“That made it so that it essentially pushed producers away from using it. The crop is then susceptible to those insects so you have to go in with a ground spray or aerial spray multiple times,” said Konieczny.

“The input and cost just became too much for those European farmers. So, you take a bunch of canola out of the market and combine that with a shortage of tons in Canada as well, and the price just kind of skyrockets. There might be more demand in China too.”

A normal price for peas he said is between $6.50-$8, while right now you can get over $10 for old crop, and there are targets triggering around $9.50 for new crop.

He said for feed barley you can usually get between $3-$4 per bushel for an old crop, but that it has also gone “crazy” and now you can get anywhere from $5.50-$6.50. For the past few years, he said Canadian Prairie Spring (CPS) wheat has usually been between $5.50-$7, but it has also gone up and is selling as good as hard red spring wheat. He has seen bids for old crop CPS of $7.70 per bushel or higher.

“It’s not always cut and dry what is going to make the most money,” said Konieczny.

“Some are less labourous, some have less standards when you are selling which factors into price. Another big thing is crop rotation – you can’t just always grow the same thing or you will have disease, weeds, insects, or resistance issues.

He said their seed company specializes more the cereals and pulses, but from a farmer’s perspective, he predicted that some people will be changing a few hundred acres or a few quarters out from spring wheat or something into canola in order to get more acres into next year’s canola market.