(Resource News International) — Cheap feed barley prices in Western Canada are unlikely to see much improvement, but the domestic market remains at a premium to the Canadian Wheat Board and should continue to provide the best opportunity for producers with barley to sell going forward.
Michelle Balderson, a feed grains merchant with Shafer Commodities at Lethbridge, Alta., said end-users in the key cattle feeding region were purchasing barley for the “cheap level” of about $148 per tonne right now.
Balderson said the demand was fairly steady at that level, but with farmers holding out for better prices there was not actually a lot of business taking place.
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Storage space issues, she added, were the primary driver behind any sales at current prices.
Growers may be holding out for better prices, but Balderson didn’t think there was necessarily much room to the upside. However, she added, activity in outside markets could possibly spill over to lend some support to barley bids.
While there isn’t likely much room to the upside in domestic feed barley bids, the prices in the country still compare quite favourably to the CWB’s projected values, according to market analysts who didn’t expect to see much in the way of CWB feed barley exports this year.
The CWB’s current pool return outlook (PRO) of $152 per tonne in-store Vancouver for feed barley works out to a price of only $94.60 per tonne in Alberta when deductions are factored in.
