Winnipeg, (MarketsFarm) – The slide in Western Canadian feed grain prices over the past few months is showing signs of slowing down, as concerns over harvest delays supplant earlier concerns over large crops and quality downgrades.
“The weather over the next week or so doesn’t look that great,” said Allen Pirness of Market Place Commodities in Lethbridge, Alta. on Sept. 26.
While there was some harvest progress earlier this week, he said the forecasts calling for poor weather and even snow in some areas will halt both the harvest and the price declines.
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“We’re at a point where we have to get stuff off,” said Pirness adding “I haven’t seen prices soften at all this past week.”
Barley was currently trading at just under C$200 per tonne into the Lethbridge area.
The weather issues delaying harvest will also lead to quality downgrades and more feed grain, with aggressive sales of lower quality feed durum already coming to market as “it won’t get better with age.”
However, Pirness also noted that “the rising tide floats all boats” and expected the rally in higher quality spring wheat and durum would also underpin feed prices.
Weather over the next week could also lead to issues getting grain delivered into southern Alberta, which would result in short-term strength. At the same time, feedlots are starting to fill up and will soon ramp up to a higher grain intake over the next few weeks, said Pirness.
While nearby factors may be providing some support for feed prices, “we’re still facing a big mountain of grain this year,” said Pirness adding “it will come off eventually and need to find a home.” As a result “the potential of any kind of significant rally in the feed grains is really muted this year.”
