Feed weekly outlook: A tale of two Prairie grain markets

Reading Time: < 1 minute

Published: May 9, 2019

, ,

(Photo courtesy Canada Beef Inc.)

MarketsFarm — Tight old-crop supplies may be keeping nearby barley bids underpinned on the Prairies — but expectations for increased acres in 2019 mean new-crop bids are at a considerable discount.

“It’s a tale of two markets right now,” said Glen Loyns, general manager of JGL Commodities at Moose Jaw, pointing to the large spread between old- and new-crop barley.

“You have old-crop barley that’s staying strong with high demand and limited inventory left out in the country,” he said, adding that a lack of farmer selling was also underpinning the spot market, as producers focus on seeding.

Read Also

Photo: Getty Images Plus

Alberta crop conditions improve: report

Varied precipitation and warm temperatures were generally beneficial for crop development across Alberta during the week ended July 8, according to the latest provincial crop report released July 11.

While feedlots are reasonably covered, “I think there’s still some demand out there,” he said, but added that demand will also depend on cattle prices, which have come under pressure in recent weeks.

“On the flipside, you have new-crop grain pricing that’s considerably cheaper than old-crop.”

Old-crop barley is currently priced in the $250 per tonne area delivered into Lethbridge, while new-crop bids are closer to $210, according to reports from the region.

Expectations are for an increase in barley acres in 2019, which is weighing on the new crop.

“As time goes on, old-crop and new-crop will converge somewhere along the way,” said Loyns, adding “you’ll get a clearer perspective once seeding is done.”

Whether that means a drop in old-crop prices, a rise in new-crop bids, or a combination of the two remains to be seen.

— Phil Franz-Warkentin writes for MarketsFarm, a Glacier FarmMedia division specializing in grain and commodity market analysis and reporting.

About the author

Phil Franz-Warkentin

Phil Franz-Warkentin

Editor - Daily News

Phil Franz-Warkentin grew up on an acreage in southern Manitoba and has reported on agriculture for over 20 years. Based in Winnipeg, his writing has appeared in publications across Canada and internationally. Phil is a trusted voice on the Prairie radio waves providing daily futures market updates. In his spare time, Phil enjoys playing music and making art.

explore

Stories from our other publications