MarketsFarm — Seasonal weight restrictions and spring road bans are providing some underlying support for feed grain bids in Western Canada, with the COVID-19 coronavirus outbreak also being followed closely.
“Winter weights are coming off, which is restricting the areas (feedlots) can pull from,” said Allen Pirness, of MarketPlace Commodities in Lethbridge, adding “there’s a firm tone to the market, but it’s not really moving higher.”
Looking further out to the spring and summer, there’s not much of a carry in the market, according to Pirness. Expectations for increased barley acres in 2020 were limiting prices for deferred deliveries, he said.
“When the expectation is for cheaper new-crop grain, then they’ll draw their inventories down, rather than replace.”
However, with concerns over the COVID-19 coronavirus roiling international markets, “we’re encouraging end users to stay closer to the top end of their inventories for now,” said Pirness, pointing to the possibility of supply chain disruptions if truck drivers or others are forced to self-quarantine.
— Phil Franz-Warkentin reports for MarketsFarm from Winnipeg.