Canada: Barley supplies projected sharply up in 2022-23

For 2022-23, Canadian barley supplies are projected at 10.6 million tonnes (Mt), up sharply from last year’s record low of 7.9 Mt, Agriculture and Agri-Food Canada said in their April report.

Total domestic use is forecast at 6.0 Mt, up 28% from last year on higher feed and industrial use. Total exports are projected at 3.7 Mt, up 37% from last year. The major international destinations for Canadian barley and products include China, the US, Japan and Mexico.

Carry-out stocks are projected at 0.9 Mt, rising sharply from last year’s record low and marginally above the previous five-year average.

The Lethbridge feed barley price continued to drop over the past month but in a gentle manner. For the crop year to-date, the Lethbridge feed barley price averaged around C$418/tonne (t), versus C$429/t for the same period a year ago. For the entire crop year, the Lethbridge feed barley average price is forecast at C$410/t, down nearly C$20/t from last year’s record high.

According to the US Department of Agriculture (USDA)’s March Grain Stocks report, US barley stocks in all positions on March 1, 2023, were higher than a year ago. At 88.7 million bushels (Mbu), US barley stocks were up by 22% from a year ago. This is primarily due to a significantly larger output, offsetting record-small carry-in stocks on June 1, 2022. Despite this, the USDA projected that the US will continue to increase barley imports in 2022-23 after a surge of imports in 2021-22 when production fell sharply. Total use is predicted to increase, largely reflecting a rise in the feed and residual category.

Carry-out stocks on June 1, 2023, is projected at 62.0 Mbu, up by 48% from last year but down 17% from the previous five-year average.

For 2023-24, Canadian barley area is forecast at 3.0 million hectares (Mha), up 5% from 2022-23 and only marginally higher than the previous five-year average. Assuming average abandonment and yield potential, Canadian barley production in 2023 is projected at 10.0 Mt, remaining relatively unchanged from the previous year, despite larger acreage.

Supported by an expected increase in carry-in stocks, total supply in 2023-24 is projected at 10.9 Mt, up 3% and 6%, respectively, from 2022-23 and the previous five-year average. Total domestic use is predicted to increase from 2022-23 on larger feed use, which is above the average level, given good domestic supply. Exports are projected to decline, given the outlook for larger global feed grain supplies, but still be above average levels.

Carry-out stocks are projected at 1.0 Mt, up 11% from the previous year and a recent six-year high. The 2023-24 Lethbridge average price is projected at C$350/t, lower than the C$410/t predicted for 2022-23, partly reflecting an anticipated good domestic supply and lower US corn prices in 2023-24.

USDA’s March Prospective Plantings report showed that US farmers intend to grow less barley in 2023. At 2.92 million acres (Mac), the 2023 barley acreage is expected to decline slightly from 2022, largely due to expected sharply reduced acreage in North Dakota, one of top barley planting states, despite increased acres in other states. US barley has seen a rising trend in acreage in recent years. Although the 2023 acreage is lower than in 2022, it is still 7% above the previous five-year average.

Worldwide, the combined 2023-24 barley production in the world’s major barley exporting countries is expected to decline by 7% (7.6 Mt) from 2022-23 to reach 101 Mt, the lowest in three years, according to the International Grains Council (IGC)’s March monthly market report, which includes 2023-24 supply and demand projections for the major crops for the world’s main exporting and importing countries. The 2023-24 production projections for Australia, Russia and Ukraine presented a significant decline, but showed a notable increase for Argentina with a minor change for Canada and the EU. The decline in the combined production is expected to be only partly offset by an increase in combined opening stocks, leading to a lower combined supply.

Exports from major exporting countries are projected to decline by 5% (1.6 Mt). The combined closing stocks are projected to drop by 15% (2.2 Mt) to 12.6 Mt.

21 April, 2023