February 22, 2012

Feed barley prices of Canada's Alberta stay firm

The values of feed barley in Canada's southern Alberta continue to be firm due to the absence of willing sellers and advances in other grains.

However, the lack of fresh demand is limiting any upward price movement, keeping barley in a narrow range, said an industry participant.

Lethbridge feed barley spot bids in mid-February are US$210 per tonne, up from an early February low of US$208, said Jim Beusekom, grain trader with Market Place Commodities in Lethbridge.

New-crop bids are ranging from US$200 to US$210 per tonne, Beusekom said. Tightness in the cash market has been supportive towards current bids, he said, adding that the upward trend in rapeseed and malt barley prices is also enticing producers to hold onto their supplies longer, hoping for higher feed barley values.

However, the upward price potential is being limited, with feed barley demand at its lowest level since last fall, he said.

Some fresh demand from the cattle industry would help enhance feed barley's upward price potential, he said.

However, without any new demand coming, any movement in prices will be limited, Beusekom said.

That demand may be hard to come by this year, with a smaller cattle population and an unseasonably warm winter pushing feed barley use demand down by 2% in 2011-12, according to Wednesday's (Feb 15) supply and demand report from Agriculture and Agri-Food Canada.