The EU barley exports may reach a decade-high this season, as the EU is able to shift a large harvest due to the brisk demand for feed overseas and the reduced competition in the Black Sea Region.

The surge in demand for European "feed" barley has brought relief to producers who were struggling with low grain prices on a global market that was oversupplied. Feed barley attracts higher prices than milling barley and is priced similarly to malting barley used as beer ingredient malt.

Brent Atthill, director of RMI Analytics, said: "It is a strange market." He cited a "perfect hurricane" of strong demand for feed in the Middle East and China, limited Black Sea barley availability, and weak brewing demands in Europe. Last week, the European Commission increased its forecast for EU barley exports by 9% to 11 million tons. This would be the highest level since 2015/16.

The early season shipments from France to China were followed by a steady demand for North Africa and the Middle East. LSEG data show that a cargo to Turkey is a rarity. The switch by Turkey this season from exporter to buyer of barley has contributed to the market tensions. Next Wednesday, the country will hold an import auction. A German trader stated that an import purchase this week by Algeria could lead to more EU sales. Algeria hasn't bought French grain from France since 2024 due to diplomatic tensions.

Another trader stated that this year, German barley has been shipped to Algeria, Saudi Arabia, and Iraq in quantities of 30,000 tons, 60,000 tons, and 8,000 tons.

The second trader stated that "both Germany and France have exported large amounts of barley this year, and I expect to see more on the way."

However, the export window for barley from western Europe could close soon. The supply of barley in France is tightening, while crops from the southern hemisphere are increasing options for importers.

Analysts and traders said that the forward prices for 2026 suggest that feed barley is likely to return to its former role as an affordable grain. It will offer discounts of double digits compared with milling wheat and malting barley.

(source: Reuters)