MarketsFarm — Preliminary crop yield estimates released by Statistics Canada on Monday outlined just how severely the drought in Western Canada cut into production.
Mike Fleischhauer, general manager for Eagle Commodities at Lethbridge, Alta., was not at all surprised by the numbers.
“I think we knew that was happening all along,” he said. “There are lots of places that virtually have no bushels per acre and there are some that are OK…Where (crop prices) are going to stay over the next month or so will be undetermined. But that alone shows there’s not enough grain to be harvested.”
Statistics Canada projected 22.9 million tonnes of wheat produced in 2021, a 34.8 per cent drop from a year before and a 28.7 per cent decline in average yield to 37.2 bushels per acre.
Barley production also fell 27 per cent to 7.8 million tonnes, but corn production, due to ideal conditions in Ontario, increased by 0.8 per cent to 13.68 million tonnes.
Fleischhauer mentioned more feedlots are “jumping on the corn bandwagon” due to their prices.
Meanwhile, prices for feed barley and feed wheat in Alberta are starting to ease. The high-delivered bid for Alberta feed barley on Wednesday decreased by 22 cents over the previous week, to $9.04 per bushel, according to Prairie Ag Hotwire data.
For feed wheat in the province, a 27-cent drop compared to the week before resulted in a high-delivered bid of $11.57/bu.
However, both prices are still $4.53 and $5.36 higher than last year, respectively.
“(The prices) have gone down a little bit. The harvest is starting again. Last week and the first part of this week, it was raining everywhere…(And) if the harvest is stopping, there is nothing there,” Fleischhauer said.
However, feed grain prices in Saskatchewan and Manitoba continue to rise. In the former, feed barley traded as high as $8.25/bu., up 24 cents from last week, and feed wheat’s high-delivered bid increased six cents, to $10.31/bu.
Grain from southern Saskatchewan was making its way into the U.S. and Manitoba, Fleischhauer said.
In Manitoba, the high-delivered bid of feed barley jumped 68 cents, to $8.10/bu. For feed wheat, the price rose 67 cents, to $9.80.
The Port of Thunder Bay on Thursday reported a rare, if not its first, inbound grain shipment. It consisted of 12,000 tonnes of wheat from the Richardson elevator at Hamilton, Ont. bound for Manitoba feedlots last month.
Prices of feed grains will start to come down, Fleischhauer said, once corn starts appearing in feed rations in the fall. However, empty bins may mean the price drop will be short-lived.
“It’s never going to go down to where we were last year because there’s just not enough inventory. Exports are still high and the inventory is down 35 to 40 per cent,” he said.
“I think over the next five to six weeks we will see (prices) start to trickle down, but will we see $350 barley or wheat (per tonne)? Not sure.”
— Adam Peleshaty reports for MarketsFarm from Stonewall, Man.
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