Winnipeg – The feed barley market is in the middle of its seasonal slow-down.
While demand should pick back up in the New Year, the prices might not have much room to the upside given the ample feed wheat supplies.
“If you didn’t look at the calendar, you could still guess it was December,” said Allen Pirness, of Marketplace Commodities in Lethbridge, Alta.
“Bids have backed off and cattle feeders are covered through December,” he said adding that farmers are also reluctant to sell at these levels and are now waiting for 2015.
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Looking into the new year, there are cases to be made for both higher and lower barley prices.
The supply-demand numbers for barley look bullish, said Pirness pointing to this year’s smaller crop.
However, there are other options for livestock feeders such as ample feed wheat supplies that could displace barley in rations, said Pirness.
But some line elevator companies have increased their demand for feed wheat in some areas and that could limit how much eventually makes its way into domestic feed channels.
Current prices for feed barley and feed wheat are around C$190 per tonne in southern Alberta, said Pirness. Feed barley had been as high as $205 per tonne only a couple of weeks ago.
U.S. corn and dried distillers grains with Solubles (DDGS) could also come into the Canadian livestock feed market, but Pirness said the weak Canadian dollar was limiting that movement for the time being. He noted that solid off-shore demand for DDGS had also led to situations where U.S. buyers were looking to buy-back and divert shipments that had originally been destined for Canada.
