Canada: Domestic use of barley forecast up 28% in 2022-23

For 2022-23, Canada’s total domestic use of barley, of which over 90% is for animal feed, is forecast at 6.0 million tonnes (Mt), up 28% year-over-year (y/y) due to the recovery in supply after the drought in 2021, Agriculture and Agri-Food Canada reported on August 18.

Total barley exports, including grain exports and product exports (grain equivalent), are projected at 3.83 Mt, up sharply from the previous year’s low and the previous five- and ten-year averages, also the second highest since 2008-09. This is primarily due to the recovery in domestic supply and strong exports to China.

Carry-out stocks are projected at 0.70 Mt, rising sharply from last year’s record low but far
below normal levels.

The Lethbridge feed barley price for 2022-23 is finalized at C$417/tonne (t).

For 2023-24, Canadian producers seeded 2.96 million hectares (Mha) of barley, according to Statistic Canada’s (STC) June seeded area survey. This level is 4% higher than 2022-23, but slightly lower than the previous five-year average. Approximately 52% of the barley area is in Alberta, 38% in Saskatchewan, 6% in Manitoba and 4% in other provinces.

Canadian barley yield for 2023-24 is predicted to be lower than average due to continued dry conditions across the Canadian Prairies, particularly in Southern Alberta and South-Western Saskatchewan.

Production is projected at 9.23 Mt, down 8% from last year and down 4% from the previous five-year average, as the increase in seeded area is expected to be offset by a decline in yield.

Despite an expected increase in carry-in stocks, total supply is projected at nearly 10.0 Mt, down 6% from 2022-23 and the average.

Total demand is predicted to decrease y/y, linked to lower feed use and exports, and a smaller supply.

Carry-out stocks are projected at 0.7 Mt, unchanged y/y and far below average.

The 2023-24 Lethbridge average price is projected at C$350/t, lower than the historical highs seen in the previous two years, primarily under pressure from lower 2023-24 US corn prices.

For 2023-24 US barley, the United States Department of Agriculture (USDA) has raised the yield potential considerably in its August supply and demand forecast update. For now, the US barley yield for 2023-24 is projected to be higher than 2022-23 and the average. This, along with a markedly expanded seeded area, will lead to a production of 180 million bushels (3.92 Mt), up 3% from 2022-23 and 14% above average.

Farm price is projected at US$6.75/bushel (US$310/t), notably up from the July projection and the second highest on record, despite being down from 2022-23.

The global barley production forecast for 2023-24 has been revised lower, reflecting significant downward revisions to production forecasts for Canada, the EU, and Russia. For now, world barley production is projected at 143 Mt, down 6% from 2022-23. Supply will be the lowest in five years. Ending stocks will be at a historical low.

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