Healthy exports and dry conditions are easing the usual harvest pricing pressure on prairie feedgrains this year
Farmers’ urgency to sell off the combine is pressuring western Canadian feedgrain prices, but the weight is not as heavy as usual.
“It feels like we’re seeing all producers wanting movement right away here, and that’s kind of putting some downward pressure on the price,” said Nelson Neumann, a junior trader at Agfinity at Stony Plain, Alta.
He said a lot of feedgrains are currently available, which means many buyers will not accept counter bids because they know they can source grain elsewhere.
However, not everything is working against higher prices. A couple of factors are coming into play to offset the harvest drag.
“We are seeing some downward harvest pressure on new crop barley pricing, but it is still pretty strong for the time of year due in part to drier conditions and in part due to strong export markets,” Neumann said.
Feed barley prices fell by $2.50 per tonne last week, he said.
Neumann deals mostly in the Highway 2 corridor around Red Deer and south into the feedlot alley area around Lethbridge. In the Red Deer area, he said peas and many other crops are off and delivered already.
Farmers in central regions seem to be doing OK, he said, having received a decent amount of rain.
“In the south, I would say the sentiment is, ‘we could have used it (rain) a while ago,’ ” he said.
“If it’s coming now, it’s not really that welcome. It’s just getting in the way.”
Some feedlots in the south are starting to explore other feed options with an eye on the huge mountain of corn in the United States.
In the last U.S. Department of Agriculture supply report issued Aug. 10, corn production was forecast at 14.6 billion bushels. If weather holds, the USDA predicts a record yield of 178.4 bu. per acre. However, some crop tours since then are reporting lower-than-projected yields. The USDA projected ending stocks at 1.7 billion bushels.
Neumann said all that corn has provided another feed possibility for Lethbridge area feedlots.
“So they have some coverage there, and the pricing is priced to compete with the export market,” he said.
U.S. corn was landing at Lethbridge for $250 per tonne earlier this month, he said.
A random sampling of bids from Agfinity’s website shows new crop feed barley f.o.b. Two Hills, Alta., being offered for sale at $218 to $220 per tonne last week. In Big Valley, Alta., it sold for $228 per tonne.
At Central Butte, Sask., new crop feed barley traded for $214 per tonne, and off-spec feed barley was being offered in Benito, Man., for $181 per tonne.