Feed Grain Prices Drop As Livestock Feeders Secure US Corn Supply

News in brief:- Feed barley and wheat prices experience a significant drop, reaching C$280 to C$285/tonne and C$305 to C$310/tonne, respectively, due to ample supplies and strategic US corn purchases by livestock feeders.- Barley faces a bearish outlook with a surplus of 5.45 million tonnes, leading to declining sales, while Agriculture and Agri-Food Canada forecasts a carryout of 750,000 tonnes for 2023/24. In a recent report by Market Place Commodities, feed barley and wheat prices have seen a notable decline due to abundant supplies. Jim Beusekom of Market Place Commodities in Lethbridge, Alta., revealed that feed barley prices have slid by C$5 to C$10 per tonne, currently ranging from C$280 to C$285/tonne delivered to Lethbridge. Similarly, feed wheat has retraced in the same range, with prices at C$305 to C$310/tonne. US corn, a key factor in the market, is delivering to feedlots at approximately C$295/tonne.

Livestock feeders' strategy impacts market dynamics

Livestock feeders, anticipating a shortage of barley, strategically purchased US corn during last summer's drought. This proactive approach has left feed prices under pressure, with farmers holding onto their stocks, contributing to a seven-month downtrend. According to the Statistics Canada report, as of 31 December 2023, barley stocks have risen to 5.45 million tonnes, up from the previous year's 5.17 million. Jim Beusekom warns that this surplus, coupled with Agriculture and Agri-Food Canada's forecast of a barley carryout of 750,000 tonnes for 2023/24, indicates a bearish outlook. The Canadian Grain Commission also reported lower barley quantities in the commercial pipeline compared to the previous year. Farmers, aware of the surplus, have refrained from selling their barley, further intensifying the market's downward trend. The latest figures from the Canadian Grain Commission show a decrease in producer deliveries and exports compared to the previous year.