“I think barley is something producers should always consider in their crop rotations,” the Centre’s managing director Peter Watts suggested.

“There are some advantages to growing barley. It’s an early maturing crop. It can be a week earlier than other crops. In terms of timing at harvest you can spread that out if you get your barley off early and follow with your wheat and canola,” Watts added.

He also noted input costs for barley are relatively low as farmers need to limit the amount of nitrogen, they apply in order to keep protein levels below 13 per cent.

“You can sell malting barley into the feed sector, but you can’t sell feed barley into the malting sector,” Watts explained, citing there’s often a premium associated with barley selected for malting. The Centre’s website that premium can be C$1 per bushel.

In the latest supply and demand estimates from Agriculture and Agri-Food Canada released on Jan. 20, the preliminary forecast for barley production in 2024/25 was pegged at 9.28 million tonnes, up from the nearly 8.90 million harvested in 2023/24.

For food and industrial use of barley, AAFC held its estimate for 2024/25 at the previous year’s 319,000 tonnes, while feed, waste and dockage was bumped up from 5.59 million tonnes to 5.95 million. As well, the carryover was nudged up from 750,000 tonnes to a projected 800,000.

As prices for canola and wheat have been getting hit hard in the markets lately, Western Canadian cash prices for malt barley have been unchanged for the last month, according to Prairie Ag Hotwire.

In Manitoba, the price stood firm at C$5.25/bu., while in Saskatchewan the crop fetched C$6.50 to 6.80, and it was C$6.50 in Alberta.

— Glen Hallick reports for MarketsFarm from Winnipeg. 

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Wheat and barley production for 2023/24 was significantly lower than the very large crops of the previous marketing year. For wheat, the attaché estimated Australian output for this year at 25.5 million tonnes, down from the record 40.55 million in 2022/23 which was fueled by ample rainfall. Barley came in at 10.50 million tonnes having dropped from the near record harvest of 14.14 million.

When wheat and barley are compared to their 10-year averages, of 26.5 million tonnes and 11.2 million respectively, their 2023/24 harvests were favourable, the attaché stated.

There was a small decline in harvested wheat area, the attaché noted, with 12.5 million hectares in 2023/24 compared to the 13.05 million the year before. Yields fell by more than a tonne per hectare, from 3.11 last year to only 2.04.

With a smaller wheat harvest came reduced exports, the Canberra desk reported 31.82 million tonnes in 2022/23 versus 19 million this year. Total consumption remained at eight million tonnes and ending stocks dropped from 4.37 million tonnes to 3.07 million.

The attaché noted harvested area for barley bumped up to 4.20 million hectares from the 4.13 million sown in 2022/23 but yields fell back from 3.43 t/ha. to 2.5 in 2023/24.

Marketing year exports were down as well, from 7.77 million tonnes to six million in 2023/24, but total consumption remained at six million tonnes. That saw ending stocks shrink from 3.22 million tonnes in 2022/23 to 1.72 million.

China continued figure prominently when it came to wheat and barely exports from Australia, with the attaché noting the latter has often faced stiff competition from Canada.

Of Australia’s total wheat exports, the percentage heading to China has risen from nine to 24 per cent over the last three years.

Barley witnessed a turnaround in exports, as China lifted its three-year-old ban on the Australian crop. Outbound shipments to China resumed in August 2023, with a surge in exports during September and October. In that short timeframe, China became Australia’s number three barley customer.

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AAFC included its first estimates for the 2024/25 marketing year in its January supply/demand report, released Jan. 22.

All wheat area was forecast to dip by 1.9 per cent, at 26.50 million acres, as a 2.9 per cent decline in non-durum wheat should more than counter an expected 1.4 per cent increase in durum to 6.12 million acres.

Barley area was forecast to slip by 4.8 per cent on the year, at 6.97 million acres, while area seeded to oats was projected to see the largest change on the year – rising by 27.1 per cent to 3.21 million acres.

AAFC called for a 1.5 per cent decline in canola area, at 21.75 million acres, with flaxseed dropping by 19.0 per cent to 494,000 acres. Meanwhile, soybeans should hold steady at 5.64 million acres.

The major pulse crops were all expected to see increased area this spring, with both peas and lentils forecast to rise by 5.4 per cent at 3.21 million and 3.95 million acres respectively. Chickpea area was forecast at 371,000 acres, which would be up by 7.7 per cent on the year.

Statistics Canada releases its first official seeded area estimates for the upcoming growing season on March 11.

— Phil Franz-Warkentin is an associate editor/analyst with MarketsFarm in Winnipeg. 

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Total barley production across the Prairies was down by 10 per cent on the year, at 8.707 million tonnes, according to the CGC. Average barley yields were placed at 61.3 bushels per acre in Western Canada, which was down from 70.5 bu./ac. the previous year and the 10-year average of 66.4 bu./ac.

AAC Synergy was the most popular malting barley variety seeded in Western Canada, while the area seeded with CDC Copeland continued to decline. The popularity of newer varieties, such as AAC Connect, CDC Fraser and CDC Churchill, increased noticeably, according to the CGC.

The malting barley was generally of good quality, with average protein levels steady on the year at 12.3 per cent. That compares with the 10-year average of 11.9 per cent.

The average test weight was 65.0 kg/hL, which was lower than the previous year’s average (66.7 kg/hL) and the 10-year average (66.9 kg/hL). The average 1,000 kernel weight was 46.8g, which is higher than last year’s average (45.0g) and the 10-year average (45.7g).

The newer varieties, such as AAC Connect, AAC Synergy, CDC Fraser and CDC Churchill that have kernels larger than AC Metcalfe and CDC Copeland, contributed to the overall high average kernel weight.

Soil moisture and precipitation were lacking in many areas through the growing season but a stretch of relatively cooler temperatures during a portion of July helped relieve some crop stress, as did haze from wildfire smoke, according to the report. Harvest operations started relatively early in August, as crop development was ahead of normal across a good portion of the Prairies due to the hot and dry conditions throughout much of the season. Occasional rain in August did lead to some sprouting and prevented the harvest from being completed in a timely manner.

— Phil Franz-Warkentin is an associate editor/analyst with MarketsFarm in Winnipeg.

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“I don’t think there’s any question — without sporting events, and festivals, and concerts – that beer consumption will go down,” said Peter Watts, managing director of the Canadian Malting Barley Technical Centre.

While domestic retail beer sales were reportedly up, that business wasn’t enough to compensate for lost demand elsewhere, he said.

As a result, Watts expected to see a fairly significant drop in overall beer consumption this year.

“There’s no question that Canadian malting companies are seeing reduced demand from the U.S., given the situation,” said Watts. That will translate to lower demand from the domestic malting industry for barley.

However, while there may be a small shift out of seeding malting barley, he didn’t expect to see a large reduction in overall barley acres in Western Canada.

“Producers have had reasonably positive experiences with barley in recent years,” Watts said, adding, “I think we’ll see a drop in acres from last year, but I don’t think it will be significant.”

While malt barley prices may be under pressure, he pointed out that feed barley has shown some strength.

Also, “China seems to have been able to get their brewing industry back up and running,” he said, “so we expect reasonably good demand from China, which is a big market for malting barley.”

A Chinese levy on Australian barley imports will also inevitably drive some demand to Canada, though Watts cautioned there were still concerns that any Chinese retaliation against Canada over the Meng Wanzhou situation could spill into barley.

Statistics Canada currently forecasts farmers in the country will seed 7.25 million acres of barley in 2020, which would be down slightly from the 7.402 million acres planted the previous year, but still the third-largest acreage base of the past decade.

Updated acreage estimates will be released at the end of June.

— Phil Franz-Warkentin reports for MarketsFarm from Winnipeg.

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Feed barley is trading in the $4-$4.95 per bushel area in Alberta, according to Prairie Ag Hotwire data. Prices top out at just over $4 per bushel in Manitoba and Saskatchewan.

Feed bids typically see some strength in the spring, as farmers turn their attention to spring seeding and away from delivering grain. Spring road bans that hamper logistics can also lend some support.

However, a large amount of spring-harvested grain will soon be looking for a home across the Prairies, and the anticipation of those deliveries should be limiting nearby demand.

Large carryout supplies and expectations for increased Canadian barley acres in 2020 are another limiting factor.

In addition, declining beer demand, as bars and sporting events shut down due to the COVID-19 coronavirus pandemic, may cause some malt barley to move into feed channels instead.

A number of brewers and distillers have already shifted some production capabilities away from making beverages and are making hand sanitizer in an effort to help fight the virus.

— Phil Franz-Warkentin writes for MarketsFarm from Winnipeg.

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Malt prices in 2018 were driven about 15 per cent higher due to a global shortage. According to Farmlink, drought conditions caused Australia to produce “one of the smallest barley crops in recent memory.” The crops were 18 per cent smaller than the previous growing season, and 25 per cent below the five-year average.

Canadian barley prices saw a boost at the end of 2018 due to these tightened global supplies, and prices have remained strong throughout 2019, said Geoff Backman, manager of business development and markets for Alberta Barley.

While attractive 2018 prices boosted 2019 acreage, some believe the approximately seven million acres of malt and feed barley reported by Statistics Canada may not come to fruition due to nationwide lack of seed.

“Some are saying it would have been larger if more seed could be found,” Backman said. “Some are saying it’s overstated because there wasn’t enough seed available.”

Statistics Canada reported 2019 total acreage to be approximately one million acres more than what was planted in 2018.

“We’re still waiting to see if those numbers develop. We do expect an increase, we’re just not sure of the size.”

Prices for malt barley have been between $5 and $5.50 per bushel.

— Marlo Glass writes for MarketsFarm, a Glacier FarmMedia division specializing in grain and commodity market analysis and reporting.

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China purchased nearly 950,000 tonnes of Canadian barley in the first seven months of the 2018-19 year, significantly above the five-year average.

However, feed markets in general are quite sluggish ahead of spring planting season. Lethbridge’s Feedlot Alley is currently bidding about $250 per tonne delivered for May-June feed barley contracts.

“At this time of year, there are quite a few fat cattle leaving yards,” said Brandon Motz of CorNine Commodities at Lacombe, Alta. “That takes out quite a bit of consumption.”

Supplies are strong due to a relatively smooth-sailing springtime, he noted.

“We haven’t seen any spring issues like we’ve seen in other years, like spring moisture or struggle getting inventory into bins. That helps keep prices under wraps. There’s plenty of supply; bins are full.”

In February, buyers rushed to buy grain to cover during spring seeding and road bans. That caused prices to spike, according to Nelson Neuman of AgFinity Inc. in Edmonton.

“It seems like prices took the staircase up, and the elevator down,” he said.

Due to a lack of foreign appetite for Canadian canola, experts surmise farmers may turn to barley over canola when making seeding decisions this spring.

“Acres will increase up to 10 per cent for barley,” Motz predicted. “It’s a little early to call, but we’ll see more barley acres than in the past.”

As the U.S. National Weather Service’s Climate Prediction Center recently reported a 65 per cent chance of a weak El Nino prevailing throughout the springtime, it’s possible that wetter weather is coming to some areas of the Prairies.

However, a weakening El Nino leaves room for other weather systems to come into play.

“Weather is a very key factor,” said Motz. “If we remain dry, we could see a bounce in prices. If we get snow and we aren’t able to get grain loaded, we could see a bounce again.”

— Marlo Glass writes for MarketsFarm, a Glacier FarmMedia division specializing in grain and commodity market analysis and reporting.

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“Barley stocks are tight, so the market is trying to ration the amount of barley being used and it’s doing a pretty good job of that,” said Jim Beusekom of Market Place Commodities in Lethbridge.

Feed barley is trading at $260 per tonne in Lethbridge’s Feedlot Alley, which compares with feed wheat at $255 and corn imports from the U.S. also at $255. Deferred delivery into the spring and summer has barley in the $265 per tonne area and up, while corn remains at $255.

“So the market signal to feed buyers is to switch to a different commodity,” said Beusekom.

He expected the trend would continue through the end of the crop year, “and then we’ll see what the reset looks like once we get into the new crop.”

Agriculture and Agri-Food Canada currently predicts record-tight barley ending stocks for the 2018-19 crop year of only 900,000 tonnes. The market analysis branch forecasts increased barley acres and production in 2019-20, but the actual size of the crop remains to be seen.

However, “bullish old-crop doesn’t mean much when it comes to new-crop,” Beusekom cautioned, adding that “barley has a tendency to make some big swings (in price).”

— Phil Franz-Warkentin writes for MarketsFarm, a Glacier FarmMedia division specializing in grain and commodity market analysis and reporting.

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Numbers recently posted by the Canadian Grain Commission confirmed the good news he had been waiting for.

“We kind of had an inkling they were going to be good and high and yeah, it just reaffirms it. It’s quite good, actually.”

The CGC numbers showed 1.73 million tonnes of Canadian barley, to all destinations, have been shipped as of the end of May for this crop year. During the same period for the 2016-17 crop year, Canada exported 1.026 million tonnes.

By July 31, the end of the current crop year, about two million tonnes will be exported, 1.3 million in feed barley and the rest in malt.

Nielsen said it’s gratifying that most of the feed barley was sold this winter when prices were strong. Domestic feed prices in the Lethbridge area were consistently valued in the high end of $4 per bushel.

“Just thinking ahead to the new crop year, there could be some good opportunities for some very strong sales…”

China was the top buyer, doubling its imports from a year ago. It took 1.573 million tonnes in this crop year, compared to 790,300 tonnes a year ago. That’s a 99 per cent increase, year over year.

China’s interest is likely due to weather issues in Australia, which is experiencing a harsh drought. As well, countries in the Black Sea region, Ukraine and Germany are experiencing dry conditions, limiting supply. On the flip side, producers in France are getting too much rain, Nielsen said.

Those conditions add up to a good outlook for barley, even with increased barley acreage this spring across Canada (6.499 million compared to 5.766 million in 2017) and in Alberta (3.114 million, compared to 2.85 million last year), according to Statistics Canada.

Saskatchewan seeded area for barley is 2.692 million acres this year, compared to 2.325 million a year ago, StatsCan said. Manitoba producers seeded 330,000 acres of barley this year compared to 265,000 a year ago.

“I’m going to be quite bullish on it and expect we’ll see strong values for barley” in the year ahead, Nielsen said.

— Terry Fries writes for Commodity News Service Canada, a Glacier FarmMedia company specializing in grain and commodity market reporting.

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