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Published May 06, 2013, 09:34 AM

Barley holds its own

If USDA is right, Montana farmers will plant more acres of barley this year than their counterparts in North Dakota, something that rarely happens.

By: Jonathan Knutson, Agweek

Barley, long on the decline in the Upper Midwest, is expected to hold its ground, literally, this year. Commodity group leaders say that reflects barley’s continued, albeit reduced, importance.

“It’s a crop that still fits for a lot of people,” says Ryan McCormick, a Kremlin, Mont., farmer and president of the Montana Grain Growers Association.

Farmers in his state, which traditionally ranks second in barley acreage behind North Dakota, will plant 1 million acres of the crop, up from 900,000 acres in 2012, according to an estimate by the National Agricultural Statistics Service, an arm of the U.S. Department of Agriculture.

Barley prices are attractive enough in Montana to draw interest, McCormick says. He notes that the number of craft breweries in Montana is growing, generating more interest in the crop.

Montana now has 32 breweries, ranking the state second per capita behind Vermont, according to the Montana Office of Tourism.

McCormick also says that Montana barley acreage, though projected to be higher this year than in 2012, has fallen sharply since the 1990s.

If USDA is right, Montana farmers will plant more acres of barley this year than their counterparts in North Dakota, something that rarely happens.

North Dakota barley acreage this year is expected to decline to 950,000 from 1.06 million in 2012. Barley farmers in the state generally have more planting options than Montana producers, and some of those options, particularly corn, hold more appeal this year, officials say.

Nationwide, barley acreage is expected to hold steady at 3.63 million.

Barley can be sold as either malt or feed. Malt barley is used primarily for beer, while feed barley mainly is fed to animals. Many factors, including protein levels, determine whether barley is sold as malt or feed. Malt usually, though not always, fetches a higher price than feed.

Malt barley fetches an average of $5.49 per bushel at area elevators surveyed weekly by Agweek. Feed barley is worth an average of $4.69 per bushel at the elevators.

Last year, about 90 percent of North Dakota barley was accepted as malt. Usually, the rate is only about 60 percent, says Doyle Lentz, a Rolla, N.D., farmer and president of the North Dakota Barley Council.

That higher acceptance rate increased malt barley supplies, holding down demand for malt this year, he says.

Changing role

At one time, barley was grown across much of North Dakota. Until as recently as the late 1990s, barley acreage in the state averaged between 2 and 3 million annually. Barley holds up relatively well in poor growing conditions, giving farmers some return on it, which historically encouraged them to grow the crop, Lentz says.

But competition from other crops has cut sharply into barley’s appeal. Today, the crop is grown primarily in the north-central and northwest part of the state, where growing conditions are best suited to barley.

Some North Dakota farmers who once grew, say, 500 acres of barley annually continue to raise 100 or 200 acres of the crop each year, Lentz says.

Now, barley should be considered a specialty crop, rather than a major crop such as wheat, corn or soybeans, Lentz says.

“We think we’ll hover around that 1 million mark (in acres),” he says.

Returns from malt barley remain competitive with those of most other crops, he says.