REGINA — Canadian barley production has dropped 35 percent over the past 10 years as livestock operators switched to feed wheat, distillers dried grain and corn.
Canada’s barley exports have suffered from robust international competition.
For instance, Japan used to import 300,000 tonnes of Canadian feed barley a year, but now is willing to buy from other producing areas such as the Black Sea region and the European Union, said Kenric Exner of Viterra at Canada’s Farm Progress Show in Regina.
However, increasing global demand for malt barley is reason for optimism for Canadian barley producers.
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People in urbanizing developing countries have increasing disposable income to buy higher quality food and beverages, including beer.
This trend has already increased Chinese demand for Canadian malting barley, Exner said.
“Canadian origin malting barley is a high quality malt, so they are obviously trying to produce a higher quality Chinese beer,” he said.
“I don’t know where we go from here, where it stops, but it’s a great news story for the Canadian farmer — that we are exporting more malt to China, and they are willing to take it.”
Vietnam and India are following this same trend and may become significant destinations for Canadian malt barley.
Malt barley varieties are expected to account for 60 percent of barley acres in Canada this year.
Five years ago barley acres were split evenly between malt and feed varieties, Exner said.
The craft beer industry is also increasing demand for malt barley.
“We probably use two to three times the malt versus a regular beer for this craft beer,” Exner said.
“I don’t know how long this cycle will last, but again we are seeing more demand domestically in the U.S. and Canada, and we are seeing a craft segment in Japan and China and India. So it’s really a global thing that is increasing the overall malt usage globally,” he said.
Canada continues to export feed barley, but this is a difficult market to predict.
“The Black Sea, their production has been relatively strong. Australia had a record crop last year for barley specifically and overall, so it’s tough for us to compete in some of these demand markets,” Exner said.
However, China has imported more Canadian feed barley over the last three to four months.
“Hopefully we can get a half million tonnes into China of feed, but it’s very, very difficult to predict when that demand is going to be there, and for us that typically only happens March to August. So it’s not really a staple,” Exner said.
He said the range on malt barley this summer and going into the fall will be $4.75 to $5.50 per bushel, depending on variety and time frame.
“On feed barley, I think we will be between $2.75 and $3.50 a bu., depending on production and weather, but those tend to be typical ranges,” Exner said.
