USA: Malting & feed barley varieties register rise in their prices
Even though barley prices have increased a bit in the last two weeks, the overall average price for this marketing year has been low enough to see farmers collecting loan deficiency payments on over half of the 2005 barley crop, according to the Farm & Ranch report of December 8.
Barley producers have collected $26 million in LDPs covering about 55 percent of the crop as of November 9, 2005, according to the USDA's Economic Research Service (ERS). The average payment rate for the 2005 LDPs has been 22 cents a bushel. As a comparison, in 2004, 82 percent of the crop eventually received an LDP payment. The average rate last year was 35 cents a bushel, with $80 million being paid out.
With the barley harvest completed in the U.S.A , the latest crop report did not indicate any change in the nation's barley harvest, however revised harvest reports from the EU-25 indicated higher yields than earlier expected, boosting the total crop by 0.5 million tons to 53.0 million tons. To somewhat balance this out, barley production in China is expected to decline by 0.3 million tons from the previous estimate to 2.8 million tons.
In looking at the 2005/2006 marketing year, which runs from June 1 to May 31, the beginning stocks in the U.S. were estimated at 128 million bushels. This year's production of 212 million bushels, plus imports of 15 million bushels, gives a total supply figure of 356 million bushels. In looking at world trade, the November ERS report indicated Saudi Arabia is expected to increase their barley imports from the U.S. by 0.5 million tons to 6.5 million tons.
Concerning demand - food, seed and industrial use is expected to use 140 million bushels, livestock feed will account for 80 million bushels and exports of 25 million giving a total disappearance figure of 245 million bushels. This results in a projected year end stock figure of 111 million bushels, compared to 128 million bushels at the end of the 2004/2005 marketing year.
The barley producers go on looking for signs from the maltsters as to what they might expect to see for contract prices for the 2006 crop. Grower meetings are beginning to be held in malting barley production areas. The prices for malting barley were higher in practically all locations, with advances ranging from five cents a bushel to a quarter a bushel, with all posted prices at least $2 a bushel. Prices were reported in a spread between $2.04 and $2.25 for a bushel.
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