Feed weekly outlook: Barley finds support in lull between old, new crops

MarketsFarm — Feed barley bids in Western Canada are seeing some modest strength in early September, as old-crop supplies run out and the new crop is not yet available.

“Prices have definitely gone up this past week,” said Mike Fleischhauer of Eagle Commodities at Lethbridge.

Expectations for a good 2020 crop had farmers making space and emptying old-crop supplies out of their bins in August, which had weighed on prices at the time.

That selling has dried up, but at the same time “there’s not a lot of harvest done yet,” he said.

Fleischhauer estimated the harvest was about 30 per cent done in southern Alberta, but was still only in its early stages elsewhere with farmers concentrating on other crops for the time being.

In addition, recent rain and even snow in some areas was pushing the harvest back, while the feedlots still need coverage.

Barley delivered into Lethbridge was trading at around $210 per tonne, but Fleischhauer estimated there may not be much more room to the upside given the looming harvest.

Uncertainty over export demand for Canadian barley will be followed closely going forward. While recently-imposed Chinese restrictions on Australian barley could create more opportunities for Canadian barley, Fleischhauer noted Canada’s own trade relationship with China is tenuous at present.

“All indications are showing that there should be more (barley) going international, but we haven’t seen the elevators getting aggressive yet.”

— Phil Franz-Warkentin reports for MarketsFarm from Winnipeg.