USA: Barley markets calm now that the 2013 malting barley contracts have been filled

Calm has returned to the barley markets now that the 2013 malting barley contracts have been completely filled, Farm & Ranch Guide reported on January, 20.

"Our contracts are full," said Kayla Hoffman, grain merchandiser for Sun Prairie Grain in Minot, N.D. "In our case, the $6.75 price offering was attractive to growers and the contracts booked up pretty quickly. Now the main activity is pretty much getting the bushels from the 2012 crop delivered and that's not an easy task, considering the amount of bushels we have to deliver.

"The maltsters have contracted the acres they wanted and they are not going to be short of barley again this year. This year's contracts came and were filled quickly and now we just have to move on to the next thing."

Hoffman said there are some growers who want to move some open market malting barley, but right now there are few opportunities for that to happen.

"We can take open market malt barley provided we have room, but that doesn't happen very often this year," she noted.

Given the current situation, she also doesn't expect there to be much movement in the spot cash price for malting barley in the coming months. At this time the average spot cash price for malting barley is around $6 per bushel. Hoffman rated this year's malting barley crop in the Minot area as a "great crop".

"There were a few quality issues with some of the barley," she noted, "but it hasn't been anything that the maltsters haven't been able to work with so far."

Likewise, things are rather quiet on the feed barley side of the market as well, although prices have drifted lower over the past few weeks due to the softening corn market.

"With corn prices falling off the way they have, feed barley prices aren't looking too great to the producer, when compared to just a few weeks ago," she said. "But overall, we haven't seen a whole lot of feed barley in our area just because the quality of the barley crop in the area was so good.

"Right now we have spot cash feed barley prices at $4.60, which is considerably lower than the $5 mark we had a few weeks ago."

Hoffman noted there has been little export activity in recent weeks, which has been characteristic for much of the marketing year. A glimmer of hope was seen last November when a large sale of feed barley to Japan was announced, but it now appears that was a one-time sale.

"A one-time sale doesn't do much to help the market," Hoffman said. "You need to have follow-up sales to get the market excited. From what I have heard there hasn't been any additional sales to Japan."

"The one-time sale must have been a case of having the right price at the right time and they went for it," she added.

Looking to the future, she doesn't expect feed prices to strengthen over the next few months unless we see a rally in corn prices, which would then make feed barley more attractive to some livestock feeding operations. But, on the other hand, with the recent market adjustments for most of the commodities, she doesn't see any large fall-off in prices, either.

22 January, 2013