The flat Western Canadian feed grain market will continue for the forseeable future, but there could be slight changes around the holidays and into the New Year.
“The market has been relatively flat for several weeks now and my guess is it will continue to be that way into the New Year. You may see the odd weather rally that creeps or some covering off that needs to take place,” said Brandon Motz, sales manager at CorNine Commodities in Lacombe, Alta.
As Christmas nears the feed grain market could tighten, as those in feedlot alley in Lethbridge, Alta. look to cover livestock feed over the holidays. Christmas this year falls on a Tuesday, which will make it difficult to ship grain over the holiday week.
“Most of Alberta got a little bit of snow, some more than others. So that always throws a wrench into the movement of feed grains over the holidays,” Motz said, adding throughout the rest of the winter there could be some rallies depending on what the weather is like.
The feed grain market has been mostly quiet though as corn from the United States continues to flow into feedlot alley and keep a lid on prices. According to Motz, corn has been sitting at C$255 per tonne, feed barley at C$251 per tonne and feed wheat at C$242 per tonne, all for delivery into Lethbridge.
“The underlying tone is one word, it’s corn…if you remove corn from the factor we may be looking at a totally different winter Western Canadian feed grain market,” he said.
Motz has noticed quite a bit more wheat making its way into feedlots though lately.
Overall feed grains should be well supplied throughout the winter. The latest Statistics Canada Production of Principal Field Crops report released Dec. 6 showed there is more wheat and barley in Canada than previously thought. The all wheat number was increased to 31.769 million tonnes and barley to 8.380 million tonnes, which were both higher than previous estimates.
Motz doesn’t expect the production increase to have an immediate effect on the feed grain market, but longer term he thinks it could.
“I would suspect that at some point in the New Year prices will soften as volume starts finding its way to the market. And that’s just the ebb and flow of the feed market,” he said.
