Barley: In the midst of tough regional competition

October 13, 2017 at 11:34 AM , Starry Night Ltd.
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SOFIA. Foreign trade activities in large volumes seem to have reached its sunset trajectory. Farmers are in the fields, sowing.

BULGARIA. According to local market participants, the current market beat has been long expected. The majority of barley was quickly bought out while harvest was still underway at prices that exacerbated local farmers. Quickly executing their foreign contracts, exporters uploaded the grain and shipped abroad early in the marketing season. However, not eager to release their current stocks at low price levels right now, selling parties prefer to withhold the grain for later in the year.

Barley: Following in the steps of last year?

Last year was a difficult season for local sellers since tough regional competition exerted pressure on local prices. Reluctant to release their produce at lower prices, selling market participants withheld the grain from the market for later in the season. The dynamics of the wheat market at that time supported the price of barley, which increased by a few euro/mt in the beginning of 2017, stubbornly following an upbeat trend till the end of the season. The feed industry contributed to the increase of prices since it turned to barley. Yet, trade was sluggish at best.

Harvest 2017-18

(01.07.2017 - 06.10.2017)

Beg. availability, incl. carry over

  655,451  mt

Domestic consumption

84,000 mt

Exports to the world

200,561 mt

   to EU markets

185,332 mt

   to the rest of the world

15,229 mt

Source: Bulgarian Ministry of Agriculture

There are no current market indicators that the scenario from last year will not repeat itself. The dynamics of the wheat market this season are buoyant, and as long as barley trades a few euro/mt lower than feed wheat does, the long-term prospects seem predictable.

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