The demand for feed wheat in western Canada has remained steady as more farmers in the livestock sector are incorporating it into their feeding rations.
“Feed lots traditionally over the years have used a lot of feed barley, but more and more of them are using wheat now, and some are using straight wheat too,” Gerald Snip, a grain trader with Marketplace Commodities in Lethbridge, Alberta, said.
He said more feed lots are adding wheat to their routines because the value has been similar, if not better than that of feed barley.
“Barley has pound for pound less energy than wheat, and if you can buy wheat at the same price as you can buy barley a person is definitely attracted to wheat,” Snip said.
The increased use of feed wheat comes despite the tightening of crop supplies as we near the end of the 2011/12 crop year and as finishing cattle lots start to thin out heading into the summer.
However, even with steady demand, western Canadian feed wheat values have seen little movement. Prices for old crop feed wheat delivered to the elevator at the close currently range from C$4.92 to C$6.67 per bushel, which compares to prices ranging from C$4.71 to C$6.75 per bushel at the same time in May, according to data provided by the Prairie Ag Hotwire.
Prices are also comparable to those seen at the same time in 2011, as they ranged from C$4.75 to C$6.80 per bushel. Snip said prices are similar because the supply and demand numbers at this time are comparable to those seen at the same point in the season last year.
Snip said the only change he expects to see in the market in the next little while is an increase in the selling of feed wheat as farmers finish their seeding operations.
“Farmers are going to be greasing up their combines before they know it, and realize that their bins aren’t empty,” Snip said. “So they’re going to decide they need to sell some more grain to make room for new crop and all of a sudden we’re going to get a bit of flush.”