Progress has been made in settling a canaryseed trade dispute between Canada and Mexico.

The two governments have worked out an arrangement to allow Canadian canaryseed in to Mexico, even though it does not meet that country's new zero-tolerance levels for wild buckwheat. 

At least 20 canaryseed shipments have been detained since the new weed seed regulations were introduced last month. The value of the canaryseed is about $1 million.

Federal Agriculture Minister Gerry Ritz said earlier this week that work towards full resolution is ongoing.

"We have an agreement with the Mexican government to put in place a 60 day window that will clear up the backlog at their border," Ritz says. He adds a technical team from Mexico will be in Canada soon, working with industry and looking at the export process, such as seed cleaning methods.

Murad Al-Katib, past president of the Canadian Special Crops Association, did not expect such quick results, but he likes the "market access SWAT team" that was put in place.

"This will clear the pipeline and allow us to have a constructive dialogue to find a longer term solution. It is about the best case scenario," he says.

Pulse Canada CEO Gordon Bacon says the plan provides some time to work with importers, exporters and government officials to reach a compromise. He's confident an acceptable tolerance level can be reached for wild buckwheat and other quarantine weed seeds.

"I think that the Mexican government, in conversations with embassy officials and the (Canadian) Food Inspection Agency officials, have already said that they recognize that zero is not a reasonable outcome. In fact, we have officials coming from their plant quarantine group to start those discussions this week," he says.

Seed cleaning facilities do a good job, but the cleaning is not perfect, Bacon notes. One or two and as many as a dozen wild buckwheat seeds can be found in a 100 gram sample.

Mexico is Canada's number one canaryseed customer. Annual sales have averaged 41,000 tonnes over the past three years. Total Canadian exports during that same period averaged 173,000 tonnes. Saskatchewan accounts for nearly all of Canadian canaryseed production.   

Global agri-business Viterra has issued its seeded acreage estimates for Western Canada.

Parts of Alberta, Saskatchewan and Manitoba were plagued by flood conditions and other weather-related problems this spring, making planting impossible or in some cases, washing out fields or making them impassible.

Viterra estimates total seeded acreage in Western Canada to be 50 to 52 million, compared to the five year average of 60 million acres.

The wet spring will impact the sales of inputs. There are about eight million unseeded acres and another two million or so seeded acres lost to excess rains. Viterra estimates growers in Western Canada typically spend between $70 and $110 per acre, depending on the types of crops grown and the areas in which they are seeded.

Western Canadian agri-product sales average approximately $4.6 billion annually. With the loss of acreage this year, the company expects industry sales to decline by 15 to 17 per cent in fiscal 2010, with the largest declines in fertilizer and chemical sales.

Doug Wonnacott, senior vice-president of Agri-Products, points out that it will take time to figure out exact losses of sales.
"While some of the affected acreage was seeded and we ultimately experienced some sales from those acres, sales from the unseeded portion will not be realized this year," he says, adding the impact will be felt in the third quarter of fiscal 2010.

He notes that full year results will be dependent upon fall field activity. Wonnacott predicts good harvest conditions and says producers will hopefully be able to participate in post-harvest work like nutrient applications.

"Additionally, we expect significant weed growth which will require the application of herbicides in the fall to prepare the land for the following growing season," he says.

Viterra notes the impact on grain production is more difficult to predict. Western Canadian production of the six major grains averages 49 to 50 million tonnes. Viterra currently estimates total western Canadian production at 42 to 44 million tonnes, with industry receipts around 28 million tonnes (reported as industry receipts of the six major grains by the Canadian Grain Commission), based on the information available to date.

While the reduced acreage will affect the amount of grain produced by approximately 800,000 tonnes per one million acres, it is the company's view that the estimated six million tonnes of on-farm carry-over stocks, coupled with yield potential on acreage unaffected by the weather, could somewhat offset the impact of unseeded acreage.

Statistics Canada is scheduled to release its seeded acreage estimates on Aug. 20.

Manitoba potato growers have been hit with late blight about four to five weeks earlier than normal this year, according to Vikram Bisht, plant pathologist with Manitoba Agriculture, Food and Rural Initiatives.

The disease, which is not usually seen until July, was confirmed earlier this summer in potatoes in the Winkler, Carman, Carberry and Winnipeg areas, in western Manitoba and even in fields where growers were using rotating fungicides and spraying every five days.

Bisht says a number of factors may have contributed to the early outbreak, like excessive spring moisture conditions and possible infection from tomato seedlings sold through retail gardening locations in Winnipeg and Brandon.

Bisht calls the disease a "community problem" including gardeners and commercial nurseries. The fungus spores are easily carried by wind or even by walking through an infected garden.

"Everyone has to stay on top of the problem," he says.

Improper disposal of cull potatoes is one of the biggest culprits in the spread of the disease. If plants are laid out in the field, the cold winter temperatures normally kill the spores. But Bisht says spores can survive up to -30 C if the plants are left in piles.

Although the fungus is not new to Manitoba, it has adapted over the years to various fungicides and chemicals previously used to control it. Growers are advised to regularly change the chemicals they use to prevent tolerance to the treatment.

As well, growers are advised to avoid exceeding the maximum residue limits. This can occur if they move from a five-day to a four-day spray cycle for disease control.

Although it has been fairly dry over the last few weeks, Bisht says the spread of the disease will depend on the amount of rain over the rest of the growing season.

"Late blight loves wet weather," he says, noting that if a field is left unprotected during a few days of humid, rainy conditions, the whole crop can be infected in three to four days. "It has to be protected by chemicals."

For more information check out the MAFRI website at www.potatopro.com.

Cattle producers are welcoming the release of details of funding for Canadian slaughter facility programs.

John Masswohl, director of government and international relations with the Canadian Cattlemen's Association, says the recent federal announcement of $25 million for an abattoir competitiveness program is good news.

"It's what we've been asking for," he says.

Masswohl says the 55 cent per kilogram payment available to abattoirs for handling specified risk materials from animals over 30 months will put money back into producers' pockets. 
 
The program, which ends March 31, 2011, provides grants based on the volume of specified risk materials produced from OTM cattle during the 2010 calendar year.

The $31.90 per animal is slightly above what industry asked for, Masswohl adds.

According to Masswohl, local abattoirs stopped slaughtering OTM animals due to the cost of handling specified risk materials. The abattoir competitiveness program funds puts abattoirs in a better position to accept those animals. Masswohl says that will get money back to cattle producers. 

"It'll impact every province," he says. "It's a light at the end of the tunnel."

Masswohl says CCA looks forward to a continuation of this program once the year ends.

"The key is to be able to demonstrate to the federal government decision makers that in the first year, the $25 million actually made it through to producers." he says. 

Jay Fox, president of the Manitoba Cattle Producers Association is equally pleased. He's optimistic producers will see the money back simply because they'll be able to sell their older animals at home instead of shipping them to the United States.

"This money allows Canadian slaughter plants to compete against those in the U.S.," Fox says.  "It equals the playing field, and,” he adds, “it's a boost to the industry's independence.”

Stan Struthers, Manitoba's minister of Agriculture, Food and Rural Initiatives, agrees the livestock industry needs to recognize and work towards its potential.

Now that the Chinese market has opened to some Canadian beef, Struthers emphasizes it's important to continue building momentum in the cattle sector and work towards building slaughter capacity to meet Canadian and world market demands.

Two new programs designed to make and market food in Quebec are, supporters say, the fruit of a dynamic new vision for Canadian agriculture.

The two new programs -- the Innovative Agri-Food Sector Support Program and the Agricultural Innovation Marketing Support Program -- were recently launched jointly by the federal and provincial governments.

The $5.6 million in funding is shared equally and the two programs are the fruit of the year-old agreement between the two governments under the Growing Forward federal policy initiative.

According to that agreement, the two governments will dedicate $192 million to programs outside the areas of farm risk management between 2008 and 2013, with Ottawa providing 60 per cent of funding costs.

According to federal Agricultural Minister Jean-Pierre Blackburn, the two new programs will make Quebec's agriculture and agri-food sectors "more competitive, boost demand for agriculture products and help to open previously untapped markets."

The IAFSSP will support projects that "promote the development of growth niches, dissemination of best methods or adoption of innovative techniques, technologies or procedures by farm businesses."

For its part, the AIMSP will offer orientation services from the innovation commercialization centres, which support businesses by helping prepare marketing plans or feasibility studies in an effort to bring new products to market.

"These programs rely on the skills and creativity of women and men who have an innovative vision for Quebec agriculture," says Claude Béchard, Quebec's minister of Agriculture, Fisheries and Food. "Their research and development work often leads to new methods and solutions that meet the challenges faced by our agri-food industry."

British Columbia strawberry and raspberry growers have been hit by a double whammy this year -- poor prices and even poorer weather.

Growers suffered through a cold wet spring and early summer, causing a delay in both the strawberry and raspberry harvest.

As well, strawberry growers lost a processor and the remaining processors dropped payments by two cents a pound from 2008 levels. The reduction in the processing market put pressure on the fresh market, which absorbs about 90 per cent of B.C. strawberries.

"While fresh market strawberry prices fluctuate widely among growers, there is no question the lack of processing puts pressure on those prices," says Mark Sweeney, berry specialist with the B.C. Ministry of Agriculture and Lands.

When the cold, wet weather finally turned, it turned with a vengeance, bringing a heat wave that set record highs in the Fraser Valley on July 7 and 8.

"The raspberries were slow coming on and then bang, we get this heat wave which will lead to a short raspberry crop and lower yields," Sweeney says.

He notes many raspberries got sunscald, leading to downgrading at the processing plants.

Sweeney says fewer berries will go to the quick freeze -- IQF -- market and instead go into jams and jellies. Since inventories were already high, this will only put more pressure on prices.

"The raspberry market has always been a roller coaster," Sweeney says. "In 2008, growers enjoyed record high prices. Last year, they moderated more than growers hoped and this year I expect even lower prices."

While the second week of July has brought "ideal" raspberry harvest conditions, Sweeney notes "you can't undo what's been done."

He points out that it's too early to predict the blueberry harvest, but expects lower yields due to the cool, wet weather during pollination.

Wet, hot and windy conditions in Ontario this season have provincial agriculture specialists on high alert about spray drift potential.

They're taking measures to point out good management practices to operators -- and to make sure farmers know problems created by drift.

Helmut Spieser, agricultural engineer for the Ontario Ministry of Agriculture, Food and Rural Affairs, says problems are simmering because of conditions arising from the unusual weather -- fields too dry or too wet, rainfall, wind and weeds too big to spray, among them.

"It's been frustrating," Spieser says. "Depending on your location in Ontario, many different factors have proved to be a hindrance in getting the spray job done."

Spieser says wind can carry off very small spray droplets. He also notes spray drift is an offence and operators can be charged under Ontario's Environmental Protection Act.

Fortunately, spray drift is avoidable. Air induction nozzles significantly reduce drift and windmeters give accurate wind speeds in the fields at the time of spraying. Product labels are also getting better at providing information about acceptable spray conditions, Spieser says.

"But the science of droplet behaviour doesn't change just because of a new or improved product," Spieser says. "You are still using nozzles to produce droplets and a sprayer to distribute those droplets uniformly across crop land."

Ontario has a program to recognize master applicators, through the Professional Applicators Institute. Spieser serves on the committee that coordinates this initiative, which is designed to raise the bar for spray applications.

Albert Tenuta, the ministry's program lead in field crop pathology, says the key to successful spraying is making adjustments to the ever-changing environmental conditions.

"Each spray operation is unique and requires planning and constant re-evaluation, often in the field," he says. "That can mean go and spray, or in some cases it may require pulling out of the field and coming back when conditions are suitable."

Twenty shareholding organic beef producers in Saskatchewan and Manitoba have partnered to develop and launch a line of organic deli meats. Products include beef wieners, jerky, breakfast sausages and smokies.

Clear Creek Organics developed the value-added products with the Saskatchewan Food Industry Development Centre Inc. (Food Centre) and the Beef Information Centre, which helped with the creation of labels, package display units for the jerky, point-of-sale and point-of-purchase materials and the development of a trade show booth.

The Canadian beef brand mark is prominently featured on all these materials. The products are available at retailers in Saskatchewan and Manitoba.

BIC says Canadian retailers are seeking value-added beef products that, as customers request, contain "no hormones or antibiotics." BIC recently partnered with Alberta’s Spring Creek Ranch on the development and launch of "fully cooked gourmet Romano cheese beef meatballs" that feature no hormones or antibiotics.

"These new products are developed to meet the needs of specific niche markets as well as add value to the carcass for the producer," says Judy Nelson, BIC chair and a cow-calf producer at Lundbreck, Alta. "These producers are reaching out into the marketplace to find ways to maximize profitability for the carcass."

Touch, taste and tour. That's what happened during Canola Camp last weekend in Saskatoon.

The Canola Council of Canada invited culinary and health professionals to the four day event. Robert Hunter, vice-president of communications, says the guest list included chefs, food magazine writers, nutritionists, dieticians and registered nurses.

"The people that come to Canola Camp are people that we think are influencers in the world of health, nutrition, as well as food," he says. "People who can come and learn canola's story and then go tell other people in the United States and Mexico."

Hunter says the story starts at the production level.

"We get them out in the field and into canola (crushing) plants. They see how canola is grown and talk to the farmer."

The group also learned about the oilseed's heart health benefits. Canola oil is low in saturated fat and a source of Omega 3 fat, which helps protect against heart attacks and strokes. It can be used in every type of cooking as a healthy replacement for soybean oil and a less expensive substitute for olive oil.

"The per unit cost of olive oil is about five times that of the same equivalent unit of canola oil. From a cost standpoint, we like to say you get the best health for the best value," Hunter says.

About a dozen people are enrolled in each Canola Camp. The first one was held 12 years ago. Hunter says the investment is paying off.

"When we go into different regions of the United States, they open doors for us because they know our product," he says.

Canola generates $14 billion annually for the Canadian economy, with $5 billion of it going to growers. About 85 per cent of canola revenue comes from export markets.

We've talked about macro-economic issues a-plenty over the past year and how the speculative money movement back and forth through various equity, currency and commodity markets exerts a key influence on grain markets.

But lately, supply-demand issues specific to grain markets are taking on a more prominent role in setting farm commodity price trends. An interesting set of market issues seems to be evolving at the present time that have the potential to set the collective tone for grain market price direction in the months ahead.

Through the past winter and into the spring, there was little to no sense of impending domestic or global grain-oilseed shortages looming, which left ag markets more open to outside market influences, and a generally sluggish-bearish tone to price activity. Overall, grain supplies looked relatively plentiful no matter where we looked globally.

But since the spring season started, and certainly gaining momentum through June and now into July, the global crop situation has started to signal some change. Here on the Canadian Prairies, we are well aware of our own cropping situation. This year, it was punctuated by unprecedented unseeded acreage, along with many more acres that were seeded under excess moisture duress -- mostly on the eastern side of Western Canada.

Canadian 2010 crop production prospects have been greatly diminished as a result. Viterra notes that total Canadian Prairie crop production which normally comes in at about 50 million tonnes, will probably be closer to 40 to 42 million tonnes this year. Others suggest it will be smaller than that -- we'll see.

The Canadian situation was just the kick-off to what seems at this time to be a changing tune to these previously bearish leaning markets. But the move higher in crop prices over the past month is not just about Canadian conditions. Hardly.

Stressed seeding-growing conditions have had an important market influence here for certain. But market prices locally can only extend so far without the added support of the broader, global ag commodity markets.

A couple of shocks to the marketing system have occurred in the past few weeks. How significant they are has yet to fully play out, but they have given international market players some pause for thought. Perhaps the generous world grain supply expected even two months ago might not be so plentiful after all.

Aside from the Canadian influence, the United States Department of Agriculture's June 30 acreage and grain stocks reports began to call into question the situation on U.S. grain supplies, notably corn. The surprise disappearance of 288 million bushels of old crop U.S. corn supply was attributed to higher than expected usage. Smaller than expected 2010 U.S. corn acreage was also a highlight.

U.S. corn ending stocks for this year were lowered to 1.478 billion bushels, a far cry from six months ago when predictions of two billion bushels that some thought we'd be looking at by now. Lowering old crop stocks in turn lowers initial new marketing year carryout estimates for 2010-11 down to 1.373 billion bushels, according to USDA's latest supply-demand report, issued July 9.

Corn futures in the span of two weeks rallied impressively. That argues that such news is now already factored into prices. Perhaps. But it also raises the idea in traders' minds that there is now less of a buffer to protect against crop threats going forward.

U.S. soybeans stocks remain very tight on old crop at 175 million bushels and maintain the current market inverse -- old crop higher valued than new crop. New crop 2010-11 U.S. bean carryout is currently projected to increase to a more comfortable 360 million bushels given record large crop prospects this year, according to USDA. But the market now understands that a mere drop of five per cent in expected yields would deal a serious blow to hopes of ample soybean complex supplies for next year.

On the demand side, China keeps buying oilseeds for nearby delivery -- notably U.S. beans. China watchers suggest demand may still be underestimated by two to four million tonnes, which would quickly take care of any U.S. excess stocks for next year.

Readers of the past columns will recall discussing the outside influences of the global economies. Although still very much in the game, it appears those influences will play a lesser role influencing grain markets. The grain markets are giving greater credence lately to evolving weather and new crop production estimates. The market is suddenly concerned with questionable production from major exporting nations such as Canada, Europe, Russia and China.

Mike Jubinville of Pro Farmer Canada offers information on commodity markets and marketing strategies. Call 204-654-4290 or visit www.pfcanada.com to find out more about his services.