Canada: Total barley supply up 17% in 2019-20

For 2019-20, the total supply of barley in Canada increased by 17% from 2018-19 due to higher production despite historically low carry-in stocks, Agriculture and Agri-Food Canada said in their April report.

Domestic use is expected to increase significantly (to 6.585 mln tonnes), largely due to higher feed use, as well as industrial use.

Total exports of barley from Canada are expected to decrease to 3 mln tonnes on lower exports of grains, despite higher exports of barley malt.

Carry-out stocks are forecast to rise sharply from last year (to 1.7 mln tonnes) largely due to a significant increase in supply.

The average prices of barley, for the crop-year to-date in the Prairie provinces, declined from a year ago but remain strong. For the entire crop year, feed barley price at Lethbridge feedlots is expected to be 14% lower than 2018-19, due to increased supply in Canada, the US and around the world.

China became the largest destination of Canadian barley grain exports since 2014-15, taking more than half of Canadian barley grain exports. For 2019-20 to February, exports to China increased by 3%. The US is the second largest market for Canadian barley grains and barley malt; exports to the US increased by 25% and 9% for barley grains and malt, respectively. Japan is another important importer of Canadian barley but is expected to register a decrease of 9% for barley grains despite an increase of 9% for malt.

World barley production and supply in 2019-20 increased to its highest level in the recent two decades. Barley production increased in the major exporting countries, including the EU, Russia,
Ukraine and Australia. World trade is expected to be more active. Imports are forecast to increase, led by Saudi Arabia, China and Morocco, including higher imports by Japan and the US. Total consumption is anticipated to grow. Carry-out stocks are expected to increase from 2018-19.

For 2020-21, the area seeded to barley in Canada is forecast to decrease due to the sharp increase in carry-in stocks and expectations for lower prices.

Barley prices in 2019-20 have decreased from last year but are still good relative to prices in the past few years, which will limit the decline in area seeded.

Production is forecast to decrease by 8% from last year, to 9.52 mln tonnes, using the five-year (2015-16 to 2019-20) average yield and harvest rate.

Supply is forecast to be similar to 2019-20. Domestic use, exports and carry-out stocks are forecast to remain close to the levels for 2019-20.

The average price of feed barley is expected to fall from 2019-20 due to good domestic supply and increased supplies from major competitors.

Area seeded in the US is expected to increase by 7% to 2.92 million acres, the highest since 2017, according to the USDA’s March Prospective Planting report. Supplies in the US is anticipated to increase on expectations for higher carry-in stocks and production.

Barley production in Australia, one of the world major exporters of barley, is forecast to increase by 3%, according to Australian agricultural government. Imports from China are forecast to fall.

24 April, 2020