Wet Canadian weather may give relief to world wheat supply squeeze

A soggy start to spring in parts of Canada may be good news for wheat supplies.

Wheat acres will rise 8.7% to 25.4 million acres, the highest level in a decade, Statistics Canada said Tuesday in a report. Analysts in a Bloomberg survey expected 24.7 million. High prices and heavy rainfall in parts of the eastern Prairies may have spurred farmers to shift acres to cereal crops.

“The acreage number along with average to trend yields will replenish global wheat supplies,” Jerry Klassen, an independent trader and market analyst in Winnipeg, Manitoba, said before the report’s release. “The Canadian wheat crop will offset a larger portion of the shortfall from Ukraine.”

Canada is a major wheat exporter and the potential for more output comes as Russia’s invasion of Ukraine is creating uncertainty about grain shipments from one of the world’s vital breadbaskets. Meanwhile, canola acres in Canada, the world’s top grower and exporter, are expected to fall 4.7% from a year ago to 21.4 million as farmers shifted acres away from the oilseed, the nation’s statistics agency said.