If your stable feeds oats to horses, you probably noticed oat prices are up significantly and availability limited. Part of the cause is a decline in oat imports from Canada. Railroads make more money hauling oil from Canada into the U.S. than grain.
So far in 2014, oat futures prices are up 42% from the end of 2013. Oats closed above $5 per bushel on the Chicago Board of Trade last week. An recent article in the Wall Street Journal points out that grain exports, including oats, from Canada are months behind schedule because railroads are shipping oil instead. All of this makes boarding horses more expensive, especially in a tough winter.
U.S. oat production has been declining in recent years probably due to strong prices for corn and soybeans. In 2013, the U.S. produced about 1.14 million bushels of oats and imported an estimated 1.59 million bushels from Canada during the same period.
At the same time, Canada, traditionally a major exporter of oats to the U.S. has been increasing acreage. Now, Canadian growers are stuck with an oats backlog because shipments to the U.S. have slowed because of limited transportation options.
Canadian officials are upset about this situation and threatening legislative action. However, there aren’t any great solutions on the horizon.