Feed weekly outlook: Export demand supports grain prices

(Photo courtesy Canada Beef Inc.)

MarketsFarm — There continues to be a very strong demand for feed grains with large amounts headed for export, according to Saskatoon-based trader Evan Peterson of JGL Commodities.

“It’s driven the prices up and made a massive competition between feed for Alberta versus shipping it overseas,” Peterson said, noting China has been the main driver of the global demand.

So far into the 2020-21 marketing year, barley exports are about double compared to this time in 2019-20, according to the Canadian Grain Commission. In the CGC’s latest report, barley exports were about 947,000 tonnes compared to around 460,000 tonnes at this point in 2019-20. Also, wheat exports are up 24 per cent at nearly 5.68 million tonnes.

Peterson said there was a large crop in southern Alberta this year, which led to a “frenzy of buying cheap grain.” When more and more was diverted to exports, prices started to increase.

“We’ve seen prices rally about $70 per tonne in 10 weeks,” he said.

Peterson said JGL’s price for barley was $265-$270 per tonne Lethbridge delivered, with wheat prices pretty much the same.

Prairie Ag Hotwire reported feed barley prices over the last week in Saskatchewan were up 25 cents at $4.25-$5 per bushel delivered. Those in Manitoba gained 29 cents at $4.19-$4.40, while Alberta prices held steady at $4.25-$5.99.

Prices for feed wheat cooled a little bit, with a drop of 25 cents in Saskatchewan at $5.95-$6.50/bu. delivered. In Alberta the price pulled back 19 cents at $5.65-$7.43. However, in Manitoba, the price rose 32 cents, at $5.35-$6.36.

“The global demand is strong and we’re going to see strong feed prices throughout the year,” Peterson said.

— Glen Hallick reports for MarketsFarm from Winnipeg.

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