Canada Markets

Feed Barley in Tight Hands

Cliff Jamieson
By  Cliff Jamieson , Canadian Grains Analyst
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A sharp, unexpected rally has resulted in feed barley prices delivered Southern Alberta hitting levels near $210/mt from the $170s in mid-June, the highest price levels reported since May 2016. New-crop bids are even higher. (DTN graphic by Nick Scalise)

A smaller barley crop planted in 2017 combined with recent hot, dry weather has resulted in locked bins this summer at a time when prices would typically be easing from seasonal highs ahead of new-crop availability. In late June, Statistics Canada reported that acres seeded to barley have fallen by 9.7% to 5.771 million acres, which would be the smallest acreage in more than 50 years.

With the majority of the prairie acres planted in Saskatchewan and Alberta, weather challenges affecting the prairie crop are quick to affect market prices. Saskatchewan's latest crop report shows the barley crop condition index falling from an initial reading in late May of 196 to the July 11 rating of 160, which is below the five-year average of 177.2. Alberta's weekly crop report also shows the Good to Excellent rating falling for the third consecutive week to 70.5, which is up slightly from the average of the previous four years.

The relentless heat over the western Prairies over the past two weeks has resulted in bin doors locked, with feed barley bids in southern Alberta spiking from roughly $180/metric ton in late June to around $210/mt today, while new-crop bids are suggested to be even higher.

Not even a high estimated carryout can stop this run. Current AAFC estimates suggest a 2016/17 barley carryout of 2.125 million metric tons, which is up 47.3% from the previous year's estimate and would be the highest carryout reported in seven years. In addition, the rally experienced in the wheat market has spilled over into the lower qualities that has been included in cattle rations, driving prices higher, while deteriorating pasture may also play a role. The latest Alberta crop report showed only 42.4% of the Southern Alberta pastures rated Good to Excellent, while 51.3% of the Central Alberta region was rated Good to Excellent.

Canfax's Weekly Feeder Summary points to Western Canada potentially losing its feed cost advantage over the United States, which will be closely watched.

Cliff Jamieson can be reached at

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