During the 2007-08 crop year, wheat and coarse grain prices traded at historical highs. Remember that barley and corn prices during the 2024-25 campaign were trading near or at five-year lows. The feed grain outlook is more important than ever with feeder cattle prices at historical highs.

Canadian barley stocks are expected to drop near historical lows at the end of the 2024- 25 crop year. Statistics Canada Stocks Report had barley supplies, as of December 31, 2024 down 500,000 tonnes from last year. Stocks report data confirms the 2024 production level and indicates the amount of barley used for feed.

Barley used for feed during the first five months of the 2024/25 crop year was slightly lower than year-ago levels. Barley exports have been exceeding year-ago levels but off-shore movement will likely slow. Export offers from Canada are premium to Australia, Black Sea and European offers. We’re expecting the 2024-25 ending stocks to finish near 656,000 tonnes, down from both the 2023/24 carryout and the 10-year average. At press time, feed barley in southern Alberta was discounted to imported U.S. corn values. This will likely change later in the crop year due to tighter barley stocks. We’re expecting a spring barley rally so that Alberta barley prices trade at a $10 to $15 premium to imported U.S. corn.

For the 2025-26 crop year, we’re expecting barley acres to increase by 7.7 per cent to 6.9 million acres. Input costs for barley are lower than other grains and barley tends to yield better than other major crops in drier years. Using a traditional abandonment rate and a 10-year average yield of 65 bu./ac., Canadian barley production is expected to reach 8.8 million tonnes, up from the 2024 crop and similar to the 10-year average.

We’re expecting Canadian barley demand to finish near average levels for the 2025-26 crop year. This would result in a carryout of 776,000 tonnes, still down from the 10-year average. The market cannot afford a crop problem, and will be very sensitive to yield developments during the growing season.

The USDA’s outlook for corn was somewhat bearish for the corn market but there are caveats to the projection. U.S. corn ending stocks for the 2024-25 crop year are projected to come in at 39 million tonnes, down from the 2023-24 carryout of 45 million tonnes and similar to the five-year average, which is around 39 million tonnes. The market is dependent on the upcoming crop to replenish supplies.

The USDA had 2025 acreage at 94 million, up 3.4 million acres from 2024. Using a traditional abandonment rate and a trend yield of 181 bu./ac., production was projected to reach 396 million tonnes, up from the 2024 crop (378 million tonnes) and five-year average (365 million tonnes). U.S. corn yields have not reached trend for six years.

During the 2024 growing season, the U.S. experienced near-perfect conditions and yields were 179.3 bu./ac. We’re expecting an average yield of 176 bu./ac. for the 2025 crop. This would result in a 385 million tonne crop and we believe this is more realistic, given weather patterns to date. Using the USDA demand projection, we expect U.S. corn carryout for the 2025-26 crop year to finish near 39 million tonnes, which is in line with the five-year average. A carryout near the five-year average will result in five-year average prices. We’re looking for the corn market to rally $1/bu. during the spring as the market incorporates a risk premium due to production uncertainty.

Much of the Midwest has received below-normal precipitation over the past six months. The weather trend indicates drier conditions.

Both Canadian barley and U.S. corn markets will be extremely sensitive to weather conditions and yield projections. The world coarse grain market cannot afford a crop problem in North America. If adverse weather does materialize, we could see sharply higher feed grain prices, which would weigh on the feeder cattle market.

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“Everything is dropping. You’ve got big crops across the board all through Western Canada. Plenty of rain with some areas with slightly too much rain,” commented Glen Loyns of JGL Commodities in Moose Jaw.

“There’s going to be a lot of grain,” he stated.

That’s coming despite less barley being planted in Canada this year. Statistics Canada issued its planted acre estimates on June 27, showing the country’s barley area at just under 6.39 million acres compared to the 7.32 million seeded last year.

Although Loyns is optimistic, he cautioned that it’s still early to be sure as to how good the crop could be, and a lot could happen between now and harvest.

“If we keep going at this rate, your yields are going to offset the shortfall we have in seeded acreage,” he said, noting should that big crop materialize, that could result in a lot less corn being imported from the United States.

“Unless the corn yields in the U.S. fall so much and the price falls, it’s going to be a competitive ingredient into this market. Right now, it looks like probably not,” Loyns explained that at this point, the U.S. is in line for its own large corn harvest.

Feed barley prices were down in the Prairie provinces, with Saskatchewan incurring the largest decline at 25 cents per bushel. Prices ranged from C$4.77 to C$5.50/bushel according to Prairie Ag Hotwire.

Prices in Alberta stepped back 11 cents at C$4.59 to C$6.21/bu. while in Manitoba those dipped three cents at C$4.95 to C$5.00.

Feed wheat prices fell further, with Alberta seeing a 54-cent drop at C$6.60 to C$8.84/bu. In Saskatchewan prices lost 25 cents at C$6.60 to C$8.25 and in Manitoba they were down eight cents at C$7.41.

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Matt Beusekom of Market Place Commodities in Lethbridge, Alta.  said the Prairies have seen copious amounts of precipitation over the past month, with the exception of the Peace River region which is still struggling with dryness.

“Every corner of the Prairies have had decent moisture from one end to the other,” he said. “Everywhere just seems to be having a fantastic start.”

The added precipitation, combined with tumbling grain prices in the United States, caused feed grain prices in Western Canada to move lower as of late.

“Barley is off from C$295 (per tonne) to probably C$285 to C$290. Corn has come from C$315 delivered at the feedlot to C$300 and feed wheat’s probably off from C$355 down to C$345,” Beusekom said.

However, this doesn’t necessarily mean more corn deliveries from the U.S. are coming in the near-term.

“I don’t know if feedlots are buying quite yet,” he added. “I think it piques their interest a little bit more, but they want to see how low it gets.”

Beusekom said it’s hard to tell where prices will go in the near future, but they may keep going lower.

“With the amount of moisture around, you would think it’s going to put a bit more pressure on prices here, especially as we’re getting closer to new crop, too,” he added. “It certainly looks like we’re going to have a big crop on the Canadian Prairies and everybody’s feeling a little bit bearish.”

Delivered bids for feed barley in Alberta ranged from C$226.43 to C$297.17/tonne, up C$1.84 from last month, as of June 5 according to Prairie Ag Hotwire. In Saskatchewan, prices were from C$234.24 to C$264.10/tonne, unchanged from last month. Manitoba prices were also steady from C$228.73 to C$229.65/tonne.

For feed wheat, delivered Alberta prices ranged from C$242.51 to C$356.05/tonne, up C$8.08 from last month. In Saskatchewan, feed wheat went for C$242.51 to C$330.70/tonne, steady from the month before. In Manitoba, only C$300.93/tonne was reported, up C$19.84 from one month earlier.

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Canada imported 34,500 tonnes of U.S. corn during the week ended May 16, taking the crop year total to 925,500 tonnes, according to the U.S. Department of Agriculture’s weekly export sales report. That’s roughly double the 406,300 tonnes of U.S. corn Canada had brought in by the same point the previous marketing year.

Outstanding sales of 129,600 tonnes still to move compare with 126,900 tonnes the previous year.

Only 3,700 tonnes of new crop sales were on the books as of May 16, which compares with 25,400 tonnes of forward business that had already been booked by mid-May 2023.

Corn bids in the key livestock feeding area of Lethbridge climbed to around C$349 per tonne during the week of May 17, which compares with C$314 per tonne the previous week, according to the provincial government’s weekly market review. Meanwhile, feed barley bids were only up by one or two dollars, ranging from C$293 to C$298 per tonne.

Feed wheat into Lethbridge was priced at C$340 to C$347 per tonne, according to the provincial report, an increase of about C$5 per tonne on the top end on the week.

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She mentioned that some producers around Calgary have already seeded 70 per cent of their acres, while areas around Edmonton are also progressing well. Many areas have received rain which has improved growing conditions in recent days, but some places haven’t been so lucky.

“There’s not much happening in the Peace (region) and Saskatchewan has been hit and miss,” Harakal said. “But it’s been good. Things are a lot better moisture-wise this year than they were last year.”

Feed barley for May-June delivery continues to be the strongest, with Harakal reporting most prices in the Lethbridge area to be between C$275 to C$285 per tonne (C$5.99 to C$6.21 per bushel). However, she also heard prices as low as C$250/tonne (C$5.44/bu.)

“There’s the anticipation we should have lower new crop prices for that July-August timeframe right now, approximately C$10/tonne lower,” Harakal said.

She added that ideal growing conditions, plentiful grain supplies and less cattle on feed should pull prices back even further.

“(Cattle) are not eating as much and people have been booking (grain) for the May-June-July timeframe for a while now. There’s not usually a ton of availability and space. Typically, that will affect prices, (causing them) to come off just as we have lots of supplies since producers have been holding out for higher prices. There’s still lots of feed barley out there,” Harakal said.

Delivered feed barley prices in Alberta as of May 15 ranged from C$4.75 to C$6.42/bu., according to Prairie Ag Hotwire, representing a seven-cent loss from last month and a C$2.61 loss from last year. In Saskatchewan, prices were from C$5.10 to C$5.75/bu., up 50 cents from one month earlier but down C$2 from one year earlier. In Manitoba, prices were between C$4.93 and C$5/bu., steady from last month but down C$1.93 from last year.

For feed wheat, Alberta prices were C$6.60 to C$9.53/bu., up C$1.09 from last month but down C$1.77 from last year. In Saskatchewan, prices ranged from C$6.60 to C$9/bu., up 88 cents from one month earlier but down C$1 from the year prior. There was one price reported in Manitoba at C$7.72, up 43 cents from mid-April and down C$1.99 from one year ago.

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“We were pretty dry throughout the winter. We haven’t had much snowfall up until recently,” Erin Harakal, trade manager at Agfinity Inc. in Stony Plain, Alta. said. “It’s going to be hard to say what we’ll end up seeing in the next couple of weeks. Hopefully, we’ll get timely rains and things won’t be as bad as they could be.

“(Weather) reports are saying (conditions) should be better than last year. Hopefully, that holds true.”

Many farmers are still looking at prices before determining which crops to plant, Harakal added.

“I think a lot of producers we’ve talked to are still inquiring what we are seeing for new crop prices. I think a lot of growers are starting to figure out what they’re going to be doing. It sounds like a lot are sticking to doing what they usually do,” she said.

Harakal also said that barley prices should start to decline later into spring as growers sell more of their grain. She had seen barley delivered into Lethbridge for March at prices between C$5.55 to C$5.77 per bushel. As for April, May and June, feed barley prices increased at C$5.77 to C$5.99/bu.

Bids for Alberta feed barley ranged from C$4.38 to C$6.21/bu., down 22 cents from last month, according to Prairie Ag Hotwire as of Mar. 6. In Saskatchewan, the range was C$4.55 to C$5.50/bu., down 25 cents, while in Manitoba, there was no monthly change at C$4.72 to C$5.00/bu.

For feed wheat, the price range in Alberta was C$6.85 to C$8.44/bu., down 41 cents from last week. In Saskatchewan, the range was C$6.85 to C$8.13/bu., down 25 cents. The high-delivered bid in Manitoba was C$7.24/bu., 23 cents less than the week before.

— Adam Peleshaty reports for MarketsFarm from Stonewall, Man. 

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“The feedlots have been good at slowly buying on the way down, so coverage is set – aside from some spot movement here and there,” said Brandon Motz, owner of Cornine Commodities in Lacombe, Alta.

Delivered barley into southern Alberta is currently priced around C$297 per tonne, which is down by about C$10 per tonne the past month, according to data compiled by the Alberta Wheat Commission.

“We haven’t seen crazy demand come into the market,” said Motz, adding that while the highs for feed barley were likely in, there was still room to the downside.

Adding to the lack of demand for domestic barley are the continued imports of corn from the United States. Export data for the week ended Jan. 25 shows that Canada has already imported 510,100 tonnes of U.S. corn during the marketing year that began Sept. 1. That compares with 196,300 tonnes of accumulated imports at the same time the previous year. There are an additional 305,800 tonnes of corn on the books slated to move later in the crop year – up by about 50,000 from the previous year’s outstanding sales at this time.

Motz expected the amount of unsold grain still on farm was above average for this time of year, with some farmers likely now showing some regret over not selling earlier. Some of those producers will continue to hold, and maybe build more bins, while others will be selling to generate cash flow ahead of the spring.

While the overall bias was pointing lower, Motz said the generally dry Prairie conditions could eventually provide some support. “If we stay dry through seeding… guys will be a lot less inclined to clean out the bins,” said Motz.

— Phil Franz-Warkentin is an associate editor/analyst with MarketsFarm in Winnipeg. 

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Jim Beusekom, president of Market Place Commodities in Lethbridge, Alta., said barley is trading in a range between C$310 to C$315 per tonne. Meanwhile, U.S. corn imports are trading at C$310 to C$320. However, Beusekom noted that corn is more often trading at the lower end of the range and it’s easier for feedlots to buy corn than barley.

“The reason (corn is trading lower) is the Canadian dollar has moved to just shy of 76 U.S. cents. That means bringing in U.S. commodities is cheaper now than it was several weeks ago,” he said.

Beusekom added that supplies are very good for feed grains, as most feedlots have already contracted grain for up to May.

“This happened the past summer when drought was at its worst. You couldn’t buy grain from Canadian farmers. They weren’t sure what they were going to have,” he said. “Feedlots loaded up on U.S. corn to ensure they had feed for their cattle that were going to come in during the fall and winter. And the result of it is a lot of the market share has gone to U.S. corn.”

Corn and barley will continue to be priced near equally going into 2024, according to Beusekom, but he noted the latter will need to be priced lower in order to increase demand by this spring.

Looking back at 2023, with the exception of summer when drought affected parts of the Prairies, Beusekom said feed grain prices were in an overall downturn.

“It was more in line with a lot of major commodities around the world,” he added. “We close out the year maybe more in a sideways trading pattern; no longer in a decisive downtrend. But that doesn’t mean you start going back up right away.

“Those that sold their grain early are doing a lot better than those who are holding on to it right now.”

— Adam Peleshaty reports for MarketsFarm from Stonewall, Man.

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“It’s kind of shocking. I know we had some harvest start in the southern part [of the province]. It seems to have really affected prices. Of course, corn got cheap with the futures dropping quite a bit,” Leclerc commented.

The September corn contract at the Chicago Board of Trade fell 52 cents per bushel over this week alone, with it closing at US$4.8825/bu. on Aug. 2.

Leclerc said those weaker Chicago corn prices led to a 50-cent/bu. drop in Alberta prices for feed barley and wheat. Also, she noted more United States corn is being purchased.

In the latest export sales report from the U.S. Department of Agriculture, Canada purchased 21,000 tonnes of old crop corn along with nearly 66,000 tonnes of new crop during the week ended July 27. The report noted that about 529,000 tonnes of new crop corn has already been bought by Canada – a record for this time of year.

Prairie Ag Hotwire, in its region-wide compilation of grain prices, feed barley and wheat were mixed over the week. Old crop barley in Saskatchewan lost 40 cents, falling to C$7 to C$7.10 per bushel delivered, while it was unchanged in Manitoba at C$7.31 to C$7.50. However, it was up nine cents in Alberta at C$6.90 to C$9.47/bu. As for new crop, feed barley across the region ranged from C$6.90 to $7.20/bu. delivered, unchanged over the week.

Old crop feed wheat saw increases of 10 and 11 cents in Saskatchewan and Alberta respectively. In Saskatchewan prices were C$7.50 to C$10.35/bu., while C$8.15 to C$11.70 in Alberta. Wheat lost 11 cents in Manitoba to be at C$9.85/bu. New crop prices on the Prairies were C$7.50 to C$10.30/bu.

— Glen Hallick reports for MarketsFarm from Winnipeg.

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[RELATED] Feed weekly outlook: Barley values steady, wheat rises

I’ve received many calls from cattle producers regarding the barley outlook. There have been a few major changes from earlier in the summer. Statistics Canada released their first crop-production estimate on August 29. Second, a ruling regarding Chinese tariffs on Australian barley is expected from the World Trade Organization (WTO) in December. In this issue, I’ll provide a review of the Canadian barley fundamentals and U.S. corn production.

According to Statistics Canada’s model-based survey, Canadian farmers are expected to harvest 9.3 million tonnes of barley this fall, up from the 2021 output of 6.9 million tonnes. Statistics Canada estimated the Canadian barley yield at 67.8 bushels per acre; however, the five-year average yield is 70 bushels per acre. Barley traders believe Statistics Canada is too low on their yield estimate. Statistics Canada will release their final yield and production estimate on December 2. This is when we’ll have the most accurate data for seeded and harvested area and yield. My contacts across Western Canada suggest that the barley yield will be closer to 71 bushels per acre. I’m also using a larger harvested area than Statistics Canada. We’re seeing more soft white spring wheat and corn used for silage in Western Canada. My 2022 production estimate is 10.1 million tonnes.

Export projections for the 2022-23 crop year are quite variable. There are two major changes from the 2021-22 crop year regarding Chinese demand for Canadian barley. First, we mentioned in August that China is now allowing imports of Russian barley. Second, the WTO will release their ruling regarding the 80.5 per cent Chinese tariff on Australian barley. Recent media reports suggest that China will abide by the ruling. There is no doubt in my mind that this decision will be in Australia’s favour. There is potential for Canadian barley exports to China to come to a standstill after January 2023.

I’m forecasting a Canadian barley carryout near 1.1 million tonnes for the 2022-23 crop year, which is similar to the five-year average ending stocks of 1.2 million tonnes. Keep in mind I’m still expecting Western Canada to have five million to six million tonnes of actual feed wheat due to the later-seeded crop. This will ensure there is no shortage of feed grains in Western Canada for the 2022-23 crop year.

December corn futures dipped down to $5.62/bu. on July 22. At the time of writing this article, the December corn futures were trading near $6.80/bu. The market has been incorporating a risk premium due to the uncertainty in production. The USDA estimated corn production at 365 million tonnes on the August World Agriculture Supply and Demand Estimate (WASDE). Traders are now expecting the U.S. corn crop to finish in the range of 350-355 million tonnes. The U.S. corn fundamentals will likely be tighter than earlier projections. This will provide underlying support to the Canadian barley market and limit the downside for the coarse grain complex.

At the time of writing this article, cash corn prices in Nebraska for October delivery were averaging US$6.75/bu. or US$264/tonne. In Lethbridge, barley for October delivery was quoted at C$360/tonne. Using an exchange rate of US$0.77 cents, the price of barley in Lethbridge would be US$277/tonne. Prices are very similar. In the 2021-22 crop year, U.S. producers had a major competitive advantage with input costs. For 2022-23, Alberta and U.S. producers will be on more equal footing.

If my fundamental projections are correct, Alberta producers will have a competitive advantage in the latter half of the crop year. This will cause Canadian feeder prices to trade at a premium to U.S. feeder cattle next spring.

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