With prairie barley prices soaring, some might expect feedlot alley to start ordering train loads of American corn.
But there’s not much incentive to bring in Yankee corn when it is just as pricey.
Corn is “totally priced out of the market,” said Calgary grain broker Doug Chambers.
“My gut feeling right now is that the only way we’ll get corn coming up here is if you get a feedlot or two ticked off that they’re having problems consistently finding barley. They’ll say: ‘Screw this. We’ll order six months of corn and it’s done.’ “
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But so long as cattle feeders can get their hands on prairie barley, they’ll probably stick to that.
The situation is different in southern Manitoba’s hog production belt, where U.S. corn is often as close as Saskatchewan or southwestern Manitoba barley and feed wheat, but few expect to see any sudden surge in corn imports.
Farm marketing adviser Errol Anderson said corn prices have shot up so much that the more distant Alberta cattle feeders can’t afford the usually cheap feedstuff.
“I don’t see corn coming into the Alberta market,” said Anderson.
That could change if corn prices plummet, or if U.S. wheat prices substantially sag, because prairie barley will stay higher since regional demand is so great.
“The barley price and feed wheat price really isn’t going to go down,” said Anderson.
Unlike the usual situation, today’s high feed prices are not due to a tiny prairie feed grain supply. High feed prices are based on strong world demand for feed grain. Prairie feed grain production, while smaller than in the past two years, is adequate for expected demand. That means that if feeders are willing to pay for it, prairie barley and feed wheat will arrive at their operations.
“There’s still lots of feed barley out there and feed wheat and winter wheat and CPS bids beat the (Canadian Wheat Board) price in many areas, so there’s enough feed out there,” said Chambers.
“We’re not in a feed shortage situation like we were in 2002-03.”
But a shortage in another area might affect feed grain demand: feedlot labour.
The fall calf run has begun and some Alberta feedlots may not fill up if they can’t find enough workers, said Chambers.
“Where do those calves end up? If they can’t get enough people, they won’t bring in the calves.”
If barley stays pricey and labour is a problem, U.S. feedlots may be able to offer better calf prices.
“If the Canadian feedlot doesn’t want to outbid the U.S. feedlot, there are going to be a lot (of calves) heading south,” said Chambers.
That would in turn suppress feed wheat and barley demand and might weaken prairie feed prices.
