(Resource News International) — Expectations for reductions in Canadian barley acres this year, due to excessive moisture concerns, have led to some firmness in feed barley cash bids, although the wet weather will likely lead to more of the crop in the ground grading as feed, tempering any upside potential.
However, the wet weather has caused farmers to slow down their deliveries to some extent, which is slightly supportive for prices, according to an Alberta-based market analyst.
A Saskatchewan feed grains broker added that “any strength in barley has more to do with farmers being unable to load for pre-existing contracts.”
While acres will likely be down, he said, the conditions will likely cause more of the barley and wheat that was planted to grade as feed.
The Alberta analyst also pointed out that “the pastures are looking fantastic in Alberta,” which should lessen the nearby demand for feed grains.
In addition, he said, the generally favourable outlook for the U.S. corn crop should also limit any upside potential in feed barley bids.
Cash prices compiled by the Alberta Canola Producers Association show feed barley bids in the key Lethbridge, Alta. feeding area increasing by about $7 per tonne over the past week, to around $140 per tonne by June 18.
That would put bids at their highest level in months. However, the analyst said, the market was still range-bound overall and would likely need to see a larger move in U.S. corn in order to break significantly higher.