MarketsFarm — It was a tale of two weeks for Saskatchewan feed barley prices.
The high-delivered bid for the crop on May 11 bolted from $6 per bushel to $6.75 in one day, according to Prairie Ag Hotwire data. Saskatchewan’s price spike put the bid only 80 cents behind Alberta’s.
However, on May 19, while Manitoba’s and Alberta’s high-delivered bids increased 11 and 29 cents, respectively, the high-delivered bid for Saskatchewan’s feed barley dropped 50 cents, to $6.25/bu.
Evan Peterson, a trader for JGL Commodities at Moose Jaw, Sask., attributed the price spike to many of the causes for barley’s rise in prices over the past year.
“We saw local barley bids increase due to dry conditions across Western Canada as well as increased corn and wheat futures,” he said via email.
For example, CBOT July corn on May 11 traded as high as US$7.325/bu., its highest level since September 2012.
Also, according to Prairie Ag Hotwire data, the high-delivered bid for Saskatchewan feed wheat on May 11 was $8/bu., 75 cents higher than the previous month and $2.25 higher than last year.
“Due to large barley export numbers that took place this year, the ending stocks on barley are also very low which has made barley increasingly difficult to purchase,” Peterson added, referring to increased exports to China.
Brent Johnson, a barley grower from Strasbourg, Sask. and a board member of the SaskBarley Development Commission, said the province’s stocks are near empty.
“I think there just can’t be a lot left out in the country. I assume there’ll be somebody who has a few bins full, but I think the taps have run dry,” he said.
However, corn and wheat prices have pulled back since May 11. Feedlots in Alberta have also purchased enough barley until August and reduced demand played a part in keeping prices steady over the past week, according to Peterson.
Meanwhile, Johnson is expecting an increase in barley acres this season compared to last. Statistics Canada is predicting a 13.9 per cent increase in barley acres this year nationwide.
“I think it will be all of that. I know, in this area, there will be a big increase this year,” he said. Statistics Canada is projecting 3.9 million acres of barley to be grown in Saskatchewan this season, a 24.5 per cent increase.
— Adam Peleshaty reports for MarketsFarm from Stonewall, Man.