Feed weekly outlook: Low ending stocks supportive

feed grains
(Photo courtesy Canada Beef Inc.)

With some of the lowest ending stocks in more than a generation, feed grain prices are doing quite well in Western Canada, said Ed Baldwin of AgChieve Grain Marketing in Winnipeg.

Baldwin, AgChieve’s manager of advisory services, said Canada has its lowest ending stocks for feed grains in the last 35 years. On the world stage, global feed grains stocks are at a 23-year low.

“That’s good for prices. Good underpinning strength to say ‘we need to grow more barley to get that replenished,'” he said.

Feed barley is currently in the $5.50 per bushel range, according to Baldwin, who noted that’s the highest price since 2013.

The story is very similar for feed wheat, with prices between $5.50 and $6 per bushel.

Around Lethbridge’s Feedlot Alley, prices are at the higher end, according to Baldwin, noting wheat has been at its best level since 2016.

“If I look at it from a charting perspective… I could draw a pretty good line at that $5.50. That’s your resistance,” he said.

For the short term, Baldwin does not expect feed grain prices to drop dramatically for the remainder of the 2018-19 crop year.

While corn imports from the U.S. continue, he said the Canadian dollar has helped to keep wheat and barley competitive.

“With a 75 (U.S.)-cent dollar, for every dollar you spend on corn costs you $1.30. So US$4 corn is $5.20 in Canada,” he explained.

As for domestic corn, Baldwin said it’s around the $5-$5.50 range in Manitoba.

— Glen Hallick writes for MarketsFarm, a Glacier FarmMedia division specializing in grain and commodity market analysis and reporting.

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