Not all Canadian crops are facing increased potential due to the falling Canadian dollar, with barley being one example. Canada's barley export potential has recently been pared in Agriculture and Agri-Food Canada's recent January supply and demand estimates, amid increased global production and declining trade volumes forecast for 2015/16.
The USDA's latest Grain: World Markets and Trade shows global barley production at 145.8 million metric tons, up close to 5 mmt from 2014/15 and the highest level reported since 2009/10. Global ending stocks are estimated at 24.213 mmt, down slightly from 2014/15 although 6% above the five-year average. Global ending stocks as a percentage of use is estimated at 16.6% for 2015/16, much tighter than other grains such as wheat (32.4%) and corn (21.6%). This is down from 17.5% from 2014/15.
At the same time, global trade estimated for the USDA's current global trade year (October 2015 through September 2016) is reported at 25.4 mmt, down 4.7 mmt or 15.6% from 2014/15. The largest cut is seen with China's 2015/16 import volume, expected to fall 2.9 mmt from the previous marketing year to 7 mmt.
The Canadian Grain Commission's Exports of Canadian Grain and Wheat Flour report indicates Canada's total licensed exports, as of the end of December, at 357,900 mt, down 45% from the 655,900 mt shipped in the same period in 2014/15. The largest cuts were seen in exports to China, with cumulative exports down 143,600 mt or 32% while exports to Japan were 100,200 mt or 94% lower than last year.
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China's official import data for December, as reported by Dow Jones, shows total barley imports at 455,986 mt, down 41.8% from December 2014. Of this tonnage, France supplied two-thirds while that country's share was down 26.3% from year-ago volumes. Meanwhile, the share of the volume supplied by Australia and Canada were both reported to be 73% below year-ago volumes, an indication of the competitiveness of global markets.
Canada's 2015/16 ending barley stocks are expected to jump by 60% from 2014/15 levels to 1.950 mmt, a return to the Statistics Canada's estimated 2013/14 level and tied for the highest level seen since 2009/10.
Current projections show a modest boost expected in acres seeded to barley in Canada in 2016, despite weak prospects for feed barley returns as indicated in government projections. Time will tell whether this becomes reality.
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