Barley prices in Western Canada are falling as an early harvest weighs on values.
“Prices have moderated here,” said Allen Pirness of Market Place Commodities Ltd. in Lethbridge.
The surprise rally from two weeks ago ended as quickly as it began. Prices that started at about $250 per tonne two weeks ago were down into the mid-C$240 per tonne range by the end of last week.
Pirness said the short-term rally is over now that harvest is underway earlier than normal.
He said dry conditions will likely play a role in how much crop farmers are able to get.
“It’s less than anticipated, but there’s still a crop. In some areas that we were wondering a month ago if they would have anything, it looks like they’re still going to have something.”
He said U.S. corn is always going to limit how high barley prices can go.
“Barley right now is still neck and neck with corn prices,” he said.
“If we saw more export demand on Canadian barley, well then, I can see a fall back to more U.S. corn being used.”
Cash prices for U.S. corn delivered to southern Alberta are at about $247 to $248 per tonne, right in line with current barley prices.
He added that even with the earlier-than-expected harvest and dry conditions, buyers still need to maintain a constant flow of grain throughout the season.
“Price is a big moderator for flow,” he said.
In central Saskatchewan, Brent Johnson said he plans to harvest his barley this week, about a week earlier than usual.
The Strasbourg-area farmer and vice-chair of the Saskatchewan Barley Development Commission, said his barley fields only saw about 100 millimetres of rain this summer.
“It’s a real short crop but we sort of got the rain in time, so it looks like the heads filled well,” he said.
“I’m thinking we’re going to be below average, but not horribly below average.”
However, even in the drier areas there were anomalies where tiny pockets received enough moisture, he said. For example, his neighbour has double the barley crop he expects to bring in.
The area south of Regina is likely even drier than his, he said, and he has heard reports from east-central regions of significantly better rain this growing season.
New crop feed barley prices delivered to the elevator were listed at $3.90 to $4.20 per bushel for Saskatchewan Aug. 7. In Manitoba, the range was $3.95 to $4.25 per bushel, and Alberta prices were listed at $4 to $4.49 per bushel.