April 2021 eNewsletter
Barley market report updates
Crop moving to next stage of market cycle
Even though fresh supplies of barley won’t show up in Western Canada for a few months, the bull market of 2020/21 is already running out of steam, as it had to at some point. All the same factors that pushed barley prices to record highs are still in place, but the lack of fresh news means tight supplies aren’t able to lift the market to the same degree.
The next stage of the market cycle normally starts to show up as users and exporters look beyond the short-term situation, which still features very tight supplies. But once they’ve booked enough barley to meet their immediate needs, the focus shifts entirely to the 2021 crop and that transition is already happening.
Domestic feed use is still the largest part of Canadian barley consumption and volumes consumed have been up the last couple of years. Even so, the increase in exports is the real tipping point and is the main reason for record prices in 2020/21. China became an even more dominant customer this year, taking 85-90% of Canadian barley exports. Our full-year export forecast of 3.15 mln tonnes would be the largest since 1996/97 (back when Saudi Arabia and the US were the two largest buyers).
Even though barley will continue to flow steadily to China through the rest of 2020/21, most of that barley has already been bought. This export business has already been factored in and the slowdown in fresh buying will allow prices to back off.
Barley prices in western Canada haven’t actually seen much of a decline yet and the first signals of a turnaround are actually coming from other exporting countries. One reason for the steady prices here is that domestic feeders are still booking some old-crop barley, although those volumes seem to be dwindling too. In countries like Ukraine and France, the 2021 harvest comes in earlier and as buyers look ahead to fresh supplies, prices are already shifting to new-crop levels.
Of course, none of the 2021 harvests are in the bin yet and situations can change. That’s especially the case in western Canada, where concerns about dry conditions are widespread. Overall though, odds of a boost in global production are fairly strong. And in western Canada, we’ve heard forecasts of big increases in barley acreage which raises the potential of a major production increase (if the weather cooperates).
We also know the Canadian barley market doesn’t operate in a vacuum. Outside influences include corn crops in the US and South America and rising geopolitical tensions with China, among others. Each of these factors is highly uncertain at this point and could significantly change the outlook. But at this point, the 2021/22 market looks like it will be friendlier for barley feeders than barley growers.
Seed test results map for Saskatchewan barley
Data is a good reminder to get seed tested this year
See below a map of fusarium infection in barley seed samples from across Saskatchewan, based on data collected up until December 2020 from Prairie Diagnostic Seed Labs, Discovery Seed Labs and 20/20 Seed Labs and published by the Saskatchewan Ministry of Agriculture (with funding from SaskBarley, SaskWheat, SaskOats and SaskPulse).
Farmers are reminded to get seed tested for disease and consider a seed treatment for diseased seed.
Seed treatments can be very beneficial when needed but may not be required in all situations. Research in winter wheat led by Brian Beres has shown increased yield stability using a seed treatment in combination with seed size and seeding rate enhanced yield stability, but the economic returns for the seed treatment were highest when the seed size, used as a proxy for vigour, was smaller. Barley specific research led by Kelly Turkington found variable responses to seed treatment – it was clearly beneficial in environments more prone to leaf disease.
Considerations where a seed treatment should be considered include at least the following:
- Seeding when the soil is cold;
- Seeding into dry conditions;
- Seeding infected seed;
- Seeding low vigour or small seed;
- Seeding in fields where root or seedling diseases have been a problem in the past;
- Seeding in fields where there have been insect pests.
Seed treatments should be selected based on the target pest and/or pathogen. They can be a single or dual action product.
Applying a seed treatment requires some set-up. It is important to ensure complete coverage of the seed with modern seed treatments. The flow rate of seed must be measured and matched to the flow rate of the seed treatment and two-stage mixing will be required.
The Saskatchewan Ministry of Agriculture’s Guide to Crop Protection provides an overview of available products for seed treatments, as well as herbicides, insecticides and fungicides. It is also a good resource for general agronomy and safety measures for pesticides.
Seeding is a huge operation. It requires many hours of preparation and even more putting the crop in the ground. It is also critical to get it right. The whole crop year depends on getting seed in the ground successfully to establish and grow a good crop. Crop establishment is the starting point and will be an important factor in yield potential for the season. It’s worth investing time in variety selection, seed testing, seeding rates, seeding dates and seed treatments.
New insecticidal seed treatment available for controlling wireworm
There is a new crop product available to barley producers this growing season that is showing great potential to help with your crop production. Teraxxa F4 is a BASF insecticidal seed treatment that controls and eliminates wireworm, which has been a significant issue for barley producers in Saskatchewan.
Growers are reminded to seek input from professionals before you use any new product on your crop. Talk with your grain buyer, including your grain company rep, and/or local elevator operators about how new crop products you plan to use could affect your marketing plans.
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Consider joining our Board
- Are you interested in helping us discover new and innovative ways to grow barley in Saskatchewan?
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If you answered “yes” to any of the above questions, we have an opportunity for you! It’s an election year for us; we will need to fill three positions on our Board as of January 2022. Nominations will open in June so watch for more information. If you have any questions in the meantime and/or are interested in learning more, please reach out to any of our current Directors or staff any time.