Feed barley under pressure: flat SFE curve, soft Black Sea bids

Spot and forward feed barley prices are soft to sideways, with Australian futures easing on the long end and Ukrainian export offers stable in EUR terms. Comfortable stocks and intense competition in global feed grains keep a lid on rallies despite some regional weather risks. The barley market enters early June with a calm but heavy tone. On the Sydney Futures Exchange, nearby feed barley contracts are unchanged while outer positions correct lower, flattening the curve. In the Black Sea, Ukrainian feed barley offers around Odesa and Kyiv have been broadly steady over the second half of May, translating into low‑to‑mid two‑digit EUR/t port-equivalent levels after freight and FX. Global data confirm ample barley and competing feed grain supplies, while logistics out of the Black Sea and weather in key origins remain the main watchpoints.

Prices & Futures Structure

The SFE feed barley strip as of 2 June 2026 shows a flat to slightly discounted nearby versus a previously richer forward curve. July 2026 traded at AUD 310/t, with September and November also at AUD 315/t and unchanged on the day. Further out, January and March 2027, as well as January 2028 and January 2029, all settled around AUD 308.5–324.5/t after a sharp AUD 16.5/t (about 5%) downward adjustment on the session in the deferred contracts.

Converted to EUR (using roughly 1 AUD ≈ 0.60 EUR), the July 2026 SFE feed barley level is about EUR 186/t, while January 2028–29 values are around EUR 195/t. This flattening suggests that earlier expectations of tighter forward balances are being repriced towards a more comfortable medium‑term supply outlook.

In Ukraine, recent physical offers for feed-grade barley seeds (cattle feed, FOB Odesa) have held at about EUR 0.18–0.19/kg, equivalent to roughly EUR 180–190/t, with FCA inland offers for 98% purity feed barley around EUR 0.22–0.23/kg (EUR 220–230/t) and little week‑on‑week movement over the second half of May. This stability contrasts with the correction in Australian deferred futures and indicates that Black Sea cash markets are already near cost-based support for many sellers.

Supply & Demand Drivers

Global barley availability into 2026/27 appears comfortable. Ukraine’s barley production in 2026/27 is projected to rise to around 6.1 million tonnes with exports potentially jumping to about 4.2 million tonnes, more than double the previous season, according to recent FAS/USDA assessments.  At the same time, Ukraine’s cumulative barley exports in the current 2025/26 season are still running behind last year (1.46 million tonnes by end-May versus 2.25 million tonnes a year ago), underscoring the presence of sizeable carry‑over stocks. 

Additional context from Ukrainian analysts points to sharply higher opening stocks for barley into 2026/27, with some estimates indicating an increase of around 140% versus 2025/26.  This stock build is a direct reflection of constrained exports and strong competition from other origins. Concurrently, Russian grain exports (wheat, barley, corn combined) are projected to fall from 4.55 million tonnes in April to about 3.3 million tonnes in May,  hinting at some moderation in Black Sea export pressure, though from still high levels.

Fundamentals & Competing Feeds

Barley remains heavily influenced by the broader feed grain complex. In North America, recent cash bids for feed barley in Canada have firmed modestly in local currency terms alongside other feed grains,  but abundant global corn and wheat supplies temper any sustained strength. For Ukraine, wholesale barley prices quoted in late May fall broadly in a US$0.40–0.80/kg range (roughly EUR 0.37–0.74/kg depending on quality and location),  broadly in line with the current CIF- and FOB-equivalent ranges suggested by actual offers.

Domestically, Ukrainian feed use of barley is projected to remain relatively stable through 2025/26, while exports represent the main balancing item.  With larger opening stocks and only modest growth in internal feed demand, export competitiveness will hinge on currency, freight, and the relative pricing of barley versus corn and feed wheat. This dynamic is already visible in SFE futures, where the long‑dated contracts have adjusted lower to better reflect the global surplus in feed grains.

Weather & Crop Conditions

Weather in key barley regions is supportive of a broadly benign production outlook. In the Black Sea area, including Ukraine and southern Russia, recent meteorological updates point to limited but adequate rainfall this week and a stronger cold front bringing cooler temperatures and scattered showers in northern zones, easing crop stress and preserving yield potential.  Planting for spring barley in Ukraine has largely been completed, with the crop now entering vegetative growth under comparatively favourable conditions.

Elsewhere, Canada’s Prairies and parts of Europe report mixed but not yet threatening conditions, and current assessments for Kazakhstan suggest that barley output for 2026/27 could be lower than last year’s near‑record levels but still near historical norms.  Overall, weather is a watch factor rather than a current bullish driver; any sustained dryness or heat wave in June–July in the Black Sea or EU would be needed to materially tighten the balance sheet.

Trading Outlook (Next 1–3 Months)

• Flat-to-soft futures bias: The sharp 5% downward adjustment in deferred SFE feed barley contracts, versus unchanged nearby months, signals a market leaning towards a sideways to slightly softer price path unless weather turns markedly adverse.
• Black Sea discounts capped: Stable Ukrainian FOB and FCA offers in the EUR 180–230/t range suggest that further downside may encounter farmer selling resistance, especially with rising production costs and ongoing logistical risks.
• Watch export pace & policy: Any acceleration in Ukrainian barley export licenses or shifts in EU tariff-rate quota administration for Ukrainian cereals could temporarily pressure basis levels, while disruptions in Black Sea logistics or sanctions could tighten supplies and support prices.

Short-Term Price Indication (3-Day View)

• SFE feed barley (Australia): In EUR terms, July 2026 is seen steady around EUR 185–190/t; deferred contracts are likely to consolidate after the recent 5% drop.
• Black Sea FOB Ukraine (feed barley): Odesa cattle-feed barley indications expected to remain around EUR 180–190/t over the next three days, with FCA inland values near EUR 220–230/t, barring abrupt FX or freight changes.
• EU nearby feed barley (CIF Med): Directionally stable to slightly weaker versus other feed grains, with buyers well covered and watching weather rather than chasing nearby cargoes.