(Resource News International) — Current growing conditions in Western Canada may lead to a larger than normal portion of the wheat crop grading as feed, which trade sources predict should keep the bias in the market to the downside.
A Winnipeg-based feed grains broker said the jury was still out on this year’s wheat crop.
“You’ll make feed wheat in the swath, and we’re not at that point yet.”
However, judging by the lateness of the crops and the current cool weather conditions “you would think we’d be on track for a higher feed wheat crop.”
With the likelihood growing that more wheat will grade as feed this year, the broker thought prices were more likely to move lower than higher.
Fusarium and vomitoxin issues in southern Manitoba may limit the feeding channels into which the wheat can go, the broker said, noting that wheat with vomitoxin can not be fed to pigs or chickens.
However, he noted, it can still move to ethanol producers or to the cattle sector.
Competing feed grains will also weigh on feed wheat values, according to the broker. There will likely be some downgrading of malt barley to feed, he predicted. Other crops could also be cut for greenfeed instead of being harvested.
Feed wheat bids, delivered to the elevator, currently range from a low of about $4.25 per bushel in parts of Manitoba and Saskatchewan to a high of $5.85 per bushel at some Alberta locations, according to Prairie Ag Hotwire data.