(Resource News International) — A slow deterioration in feed barley bids in Western Canada continues, with little to suggest that an end to the slide is in sight.
“All the normal issues remain in play and have been slowly dragging bids downwards,” said Mike Jubinville, a market analyst with ProFarmer Canada in Winnipeg.
Producers, he said, have little choice but to deliver to the domestic cash market, as prices on the international scene remain severely depressed because of ample European and Ukrainian feed barley supplies.
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“The Canadian Wheat Board just cannot compete with those kinds of values at present,” Jubinville said.
Adding to the depressed cash market state in Western Canada is the continued decline in demand from the livestock sector, as liquidations of both cattle and hog herds by producers remains strong, he said.
End-users’ search for feed alternatives also has resulted in demand for feed barley declining significantly.
“Right now, end-users have a number of contracts to bring in cheap U.S. corn,” Jubinville said, noting imports of dried distillers grains (DDGs) from the U.S. were also continuing at a strong pace.
Strength in the Canadian dollar has made it economically feasible for western Canadian end-users to bring in the cheap U.S. feed alternatives.
Warmer than normal readings across much of Western Canada over the past month or so, and forecasts for similar conditions, haven’t helped at all, he said.
Jubinville felt that with the depressed state of the feed market, western Canadian producers would certainly give serious thought to not seeding a cereal crop this spring.
Cash bids for feed barley, delivered to the elevator in Saskatchewan, based on Prairie Ag Hotwire data, currently range from $2.18 to $2.53 a bushel, in Manitoba from $2.81 to $2.85 and in Alberta from $2.10 to $3.22.
On Jan. 4, cash bids for feed barley delivered to the elevator in Saskatchewan were $2.20-$2.55 a bushel, in Manitoba $2.80-$2.89 and in Alberta $2.13-$3.27.
