(Commodity News Service Canada) –– Farmers with feed peas to sell should be seeing relatively favourable prices right now, as some end-users are being forced to bid up the market in order to acquire their necessary supplies.
Feed pea prices have moved up in tandem with edible peas over the past few months, with current f.o.b. farm bids topping out around $5.50 per bushel, according to Prairie Ag Hotwire data.
David Smythe, a commodity trader with CB Constantini in Vancouver, said logistical considerations have added to the recent strength in feed peas, with some vessels coming to load at the ports and people needing to pay higher prices in order to get the necessary supplies there in time.
Reluctant farmer selling, as many producers already have their cash-flow needs covered for the time being, was underpinning the market as well, he said.
Domestic feed buyers are also offering firm bids for timely delivery. While the end-users may have already made purchases, Smythe noted, logistical issues may have prevented them from taking delivery in the window they anticipated.
Feed mills still need to run and the animals still need to be fed, resulting in some of the nearby spot demand, he said.
The best feed pea prices right now could be in Alberta. The Manitoba feed market drew a fair amount of product from the province in late summer/early fall, and now supplies there are tighter, Smythe said.
Looking at high soymeal and high corn prices, along with the strong Canadian Wheat Board barley export program, “the buyers have no choice but to pay these higher numbers,” said Smythe.
Pea prices, he added, still compare favourably to other competing feed ingredients, such as soymeal, from a nutritional standpoint.
Another factor influencing the feed pea market this year is the higher percentage of lentils and chickpeas in Western Canada due to the poor conditions for those crops.
One benefit to feeding peas is the stronger lysine level in the crop. While lentils have lower levels of the amino acid, some feed buyers are finding they can buy feed lentils at enough of a discount and supplement with lysine.