World: Barley crop forecast reduced by 0.8 mln tonnes

Barley crop’24 continues to consist of varied results across the northern hemisphere, including France and Canada, to a very positive development in the southern hemisphere, led by Argentina and Australia, RMI Analytics said in their early September report.

The most recent news comes from Canada, where the advancement of harvest confirmed concerns about the summer extreme heatwave, which has reduced yields and brought about quality variability. Related to this news from Canada, RMI’s global barley production estimate is reduced by 0.8 mln tonnes to 143.7 mln tonnes. This brings Crop’24 global production to only 1.1 mln tonnes above the crop’23 result, a much tighter supply & demand than forecast a few months ago. In connection, total barley demand and export trade are reduced in step with the reduced supply.

Russia’s barley production has fallen back 4.1 mln tonnes from crop’23 to 17.3 mln tonnes, due to a range of weather related issues (frosts, drought, and floods).

While there are still three months before the final crop’24 result is complete below the equator, a tightening scenario for 2025 is already in place. Improved European malting selections in the UK and Denmark offer a great deal of stability to the world picture as malt demand remains sluggish.

Prices are stabilizing, mostly as wheat prices are firming globally and only partially led by barley fundamentals such as the concerning news from Canada. Australia remains the world’s most competitive malting barley origin, and Argentina appears headed to a good quality crop. The Black Sea still leads feed barley price competitiveness but prices are stronger.

In the face of a smaller global crop of barley, the market remains rather calm for the time being. In looking at malt exports from Europe, the data is mildly positive, and in parts of Europe, domestic markets are performing well (e.g. Central Europe). With wheat prices (finally) bouncing higher after a prolonged decline, now might be the time barley prices star to reflect more closely the tight S&D structure. Malting premiums are wide and helping to secure malting selections.

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