SASKATOON – Japan is safely back in the fold as a major buyer of Canadian wheat.
But discussions on barley sales have been put off for two months, while the board tries to sort out how much feed barley it will have available to sell this year.
Canadian Wheat Board chief commissioner Lorne Hehn said last week the board had renewed a one-year supply agreement with the Japanese Food Agency calling for shipments of at least 1.2 million tonnes in 1996.
Prices for the wheat sales, which will involve high quality, high-protein Canada Western red spring, will be determined through weekly tenders.
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Japan has become Canada’s most consistent long-term customer for wheat. Annual sales have averaged 1.31 million tonnes over the last 10 crop years, ranging from a low of 1.24 million in 1988-89 to a high of 1.41 million in 1993-94.
In the first 10 months of calendar year 1995, shipments totalled 965,000 tonnes. A CWB official declined to project a year-end figure other than to say the 1.2 million tonne minimum will be achieved.
As for feed barley, Hehn said the two sides have deferred negotiations on a 1996 supply agreement until January, when the board hopes to have a better idea of how much barley it will be able to lay its hands on.
“The Japanese have been very accommodating,” Hehn said in a statement from Tokyo. “Now it’s up to us to demonstrate that we can be relied upon for supply.”
He urged farmers to sign feed barley contracts with the board and make deliveries as soon as possible, so serious negotiations can get under way.
High domestic prices have made it difficult for the board to secure feed barley so far this crop year. The marketing agency is hoping that recent increases in its pool return outlook and initial payments will spur some farmers to deliver to the board’s account.
The board has been telling farmers in recent weeks that sales to Japan will actually provide a higher net return to a farmer than sales to the domestic market, even in barley-hungry southern Alberta.
A Nov. 22 sale to Japan would have netted $4.32 a bushel at Red Deer, while an off-board sale would fetch about $3.30, according to CWB figures.
However, the board’s initial payments remain well below the off-board price. Many farmers say they would rather have the cash immediately from a local sale than wait for final payments from the wheat board.
