The Canadian Wheat Board has issued a special feed barley market update alerting farmers to the recent strength in export prices.
The CWB said that for the past two years, barley from Black Sea exporters have dominated world feed markets, but an export ban from Russia and one expected from Ukraine have driven prices sharply higher.
“Traders with short positions who needed to buy barley or default, as well as feed-barley importing countries, have been seeking to cover their short- and medium-term feed barley supply needs during this time of uncertainty,” the CWB said.
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Export prices are now higher than in the domestic market, the CWB said, and it has recently sold more than 200 000 tonnes of export feed barley at favourable prices. The CWB said farmers can access sales with Guaranteed Price Contracts between the CWB, grain companies and farmers. Companies bid to supply against these tenders and the winning companies work with farmers to secure the necessary tonnage. Farmers negotiate the basis (freight, handling, trucking premiums, etc.) with companies on an individual basis. Grain companies commit to supply the CWB with the agreed-upon volume. The most recent Guaranteed Price Contract had a guaranteed price of C$215 in-store Vancouver.
The CWB said some recent sales were at values considerably higher than anticipated at the time of tender. As a result, it may have surplus earnings. If so, these flat, per-tonne payments will be distributed to all farmers participating in the Guaranteed Price Contract at the end of the marketing year, similar to the surplus payment structure of the CashPlus program for malting barley.
