E-Malt.com News article: 2094

Canada: Barley production for 2003-2004 increased by 65% from 2002-03 but supplies rose by only 41%, due to lower carry-in stocks, Agriculture and Agri-Food Canada revealed on January 20. Exports of malting barley and feed barley are both expected to increase sharply. Feed use of barley is expected to rise significantly from 2002-03, as barley displaces imports of US corn in western Canada. Barley carry-out stocks are forecast to increase but remain historically low. Off-Board feed barley prices are expected to decrease sharply. The CWB December PRO for No.1 CW Feed barley is $159/t, I/S VC/SL, versus the 2002-03 final realized price of $164/t. The CWB PRO for Special Select Two Row designated barley is $197/t, versus $242/t in 2002-03, due to higher supplies in North America and Australia.

Barley protein levels of crop 2003-04 are also likely higher than normal, which may limit the amount selected for malting purposes. Fusarium is not a problem in wheat or barley.

For 2003-04, total production of grains and oilseeds in Canada is estimated by Statistics Canada at 59.6 million tonnes (Mt) versus 43.3 Mt in 2002-03 and the 10-year average of 59.7 Mt.

Canadian barley production for 2004-2005 is forecast to increase by 7%, Agriculture and Agri-Food Canada said on January 20. Farmers are forecast to decrease area seeded to barley by 3%, as area is shifted away from grains to oilseeds, following the strong oilseed prices in 2003-2004. The area of barley crop that is harvested for fodder is expected to be below the average in recent history. Average yields are expected to increase by 8% from 2003-2004, but remain below trend due to the dry subsoil conditions. Supply is expected to increase by about 8% from 2003-2004 to 14.9 Mt as a result of increased production and higher carry-in stocks. Domestic use of feed barley is expected to rise due to increased supplies and higher feed demand from the cattle and hog industries. Imports of US corn are forecast to increase from the low level for 2003-2004, but still be significantly lower than the average for the last three years when US corn imports reached a historical high. Exports of feed barley are projected to decrease from 2003-2004, due to stronger domestic demand and diminishing price premium for offshore sales over the domestic market. Exports of malting barley are expected to increase as a result of increased production and improved quality in Canada and stronger import demand from China. Carry-out stocks are expected to increase to 1.8 Mt, from 1.6 Mt in 2003-2004, but remain historically low.

Off-Board feed barley prices for 2004-2005 are forecast to average $125/t (I/S Lethbridge), the same as for 2003-2004, as much of the increase in supplies is absorbed by domestic feed demand and exports. The CWB final pool return for 2004-2005 for No.1 CW feed barley is forecast by AAFC to decrease by $14/t from the Dec. 2003 PRO to $145/t I/S VC/SL. The pool return for Special Select Two-Row designated barley is forecast to decrease from 2003-2004, to $190/t, due mainly to increased world supplies. The pool return for Special Select Six-Row designated barley is forecast to decrease to $180/t. The premium for two-row malting barley over six-row is expected to be lower than in 2003-2004, as six-row prices are less pressured than two-row prices by increased supplies overseas and US imports of malting barley are expected to remain strong.


27 January, 2004