WINNIPEG — As barley prices climb, feedlots in Lethbridge have found a cheaper feed option — corn from the United States.
“Price has (pushed feedlots to buy corn). Barley it’s probably $4, $5 a tonne higher than the corn price right now. And the cattle feeder can source corn quite easily and more economically than barley,” said Allan Pirness of Market Place Commodities in Lethbridge.
Producers also aren’t as interested in selling their barley for feed. According to Pirness, producers are getting decent prices from grain companies for export barley. The grain year just started in August but according to the Canadian Grain Commission as of Aug. 26, 64,100 tonnes of barley have been exported. However that is less than the same period last year when 184,700 tonnes had been exported.
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“We’re starting to see some more of a switch over to U.S. corn in the feedlot space here. That’s going to take some wind out of the barley sales,” he said.
Corn prices from the U.S. are lower due to large stockpiles. According to the U.S. Department of Agriculture, corn stocks in the U.S. as of June 1 were at 5.31 billion bushels, up one percent from the previous year.
Cash bids for feed barley for producers are currently at $248 per tonne, while corn is at $247 per tonne, according to Pirness.
With the feed barley price where it’s at, Pirness doesn’t think it will hold there long and is recommending producers consider selling.
“We’re starting to take away some pretty crucial feed barley demand at these prices. The expectation for barley to go higher at this point is kind of unfounded unless the other markets (are) taken higher,” he said.
There also won’t be a shortage of feedgrain, unlike the forage shortage that is currently gripping Western Canada, according to Pirness.
“We’re seeing OK crops. They’re not huge crops but they’re OK,” he said.
Little wheat is making its way into feed markets because it’s too expensive, Pirness said. Producers are getting better prices from the grain companies because the quality of the crop is good.
