Barley production in Canada and the world is expected to be lower in 2010 as low prices dampen farmers’ interest, the Canadian Wheat Board said Feb. 22.
Large supplies have weighed on prices, but reduced production in 2010 should start to reduce supplies, said Arvin Pirness, a market analyst with the Canadian Wheat Board.
Canada’s barley production will edge lower to 9.2 million tonnes from 9.5 million in 2009, the CWB forecast at its annual Grain World conference in Winnipeg.
Global production will fall to 138 million tonnes from 144 million.
Demand for malt barley was lower during the recession last year, but should gradually grow this year, Pirness said.
“There’s some optimism we’re in for some recovery of demand, especially on the malt side,” he said.
Cool summer weather in Canada weakened meat sales during barbecue season, adding to the livestock industry’s hardships and weighing against feed demand.
This summer’s weather will play a large role in demand again, Pirness said.
“We need a warmer summer to keep us at the grills and to keep the (beer) caps coming off.”
Canadian farmers are sharply downsizing herds of cattle and pigs, but demand for feed remains stable, he said.
Ethanol demand in the United States should make imported corn too expensive to effectively compete with barley, Pirness said.
Some of Canada’s feed barley export markets in the Middle East, however, are importing less due to good crops, he said.