Much to its surprise, the Canadian Wheat Board finds itself playing a significant role in the global feed barley market this year.
As recently as July, the board said publicly it didn’t expect to have much of a feed barley export program.
Then came the unexpected crop disaster in Russia and other Black Sea region countries and poor harvest conditions in the European Union.
As a result, major feed barley buyers like Saudi Arabia and Japan began looking for alternative suppliers, including Canada, keeping prices strong.
Read Also
Saskatchewan Co-ops to acquire Blair’s locations
Blair’s Family of Companies will be turning over the operation of six ag retail locations in Saskatchewan to local Co-ops
As of last week, the board had feed barley exports of 350,000 tonnes on the books so far this crop year.
Lorelle Selinger, the board’s manager of marketing and sales for barley and barley products, was reluctant to estimate how much feed barley would be exported in 2010-11, saying that will be determined by the relationship between the domestic and export markets.
“It will depend on how our barley crop looks in the next week or so, and what the opportunity for export is,” she said.
“If farmers can sell into our domestic market at values higher than we could export, that will minimize additional business. But if it stays in this current situation where the export market is valued higher than the domestic market, then we’ll keep selling.”
The board will do what makes the most sense for producers, she said.
Some grain traders and analysts say the big question facing the barley industry is how long the current high values can be maintained.
Demand from customers in the Middle East and Asia is expected to remain strong, but many potential buyers are waiting for the results of Australia’s barley harvest. A good harvest there could send prices downward.
Meanwhile barley growers have to sort through a variety of confusing pricing options, including farm to farm or feedlot sales, the CWB’s pool account and guaranteed delivery contracts with specific grain companies.
As one anonymous farmer said in a message posted on the website Agriville. com:
“I have to admit being confused by the large number of CWB feed programs and payments/prices. Does anyone understand how they work?”
Charlie Pearson, market analyst with Alberta Agriculture, said the top priority for a barley grower is to know what’s in his bin.
“Is it potentially malt?” he said, adding growers must recognize that the standards for malt will be lower this year.
“If you think you have any chance at getting it selected, look at that as your first option.”
Pearson said barley growers have marketing choices and it’s good to have a lot of choices, adding it would also help if growers got more direct and clear price signals than they now get from the CWB.
