Feed weekly outlook: Shipping to feedlots becomes problem

CNS Canada –– Spring has sprung on the Prairies, meaning road bans are starting, leading to problems shipping feed grains to feedlots in Alberta.

“The supply is actually there at the farm gate but getting the supply from the farm gate to the end-user means more truck logistics and higher freight rates typically,” said Jim Beusekom of Market Place Commodities in Lethbridge.

On top of this, the Easter holiday long weekend is causing headaches for shipping, due to the short work week.

“Truck logistics get tighter, truck availability is tighter. So as a result supply tightens up one out of five days,” Beusekom said.

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As a result, feed grain prices are on the rise. Feed barley is trading between $244 and $248 per tonne; feed wheat is at $240-$245 per tonne, depending on the quality; and corn from the U.S. or Manitoba is at $245-$255 depending on destination and delivery requirements.

Earlier in the year, feed grain prices were closer to the $210 per tonne mark, but scarcity of delivery options has pushed up prices. The grain supply is there, but it is costing feedlots more to ship it.

The ongoing rail crisis is also affecting feed grain shipping. Western Canadian producers have been grappling with a grain backlog as the national railways have had trouble providing enough rail cars to ship grain to ports. For the Alberta feedlot industry, this is causing problems for importing corn from the U.S. and Manitoba.

“There’s some issues getting enough rail cars, maybe at times too much rail cars. It’s trying to find that balance of getting enough at the right time but not too much of it either,” Beusekom said.

— Ashley Robinson writes for Commodity News Service Canada, a Glacier FarmMedia company specializing in grain and commodity market reporting.

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Ashley Robinson writes for MarketsFarm specializing in grain and commodity market reporting.

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