Market Update – Canadian Flaxseed

The demand for flaxseed for use in the food industry is increasing due to its high nutritional value and growing utilisation in the production of various products, such as confectionery and bakery products, and energy bars. North America holds a major market share in the global flaxseed market due to high production volume in Canada.

High demand and increase in overseas exports from Canada have resulted in a reduced domestic supply for Canadian flaxseed, causing prices for the crop to skyrocket. The pandemic has also caused a significant increase in consumer demand for flaxseed, with lockdowns and restaurant closures increasing the prevalence of home baking.

Furthermore, flaxseed prices are rising because of a severe drought in Canada. Vast quantities of flaxseed growing areas have less than 40% of their regular moisture in the soil. This means that the yield this year is expected to be significantly lower than usual.

All this means that the average price of flax has increased 52.2% so far this year, as shown in the chart below.