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    Malt Barley

    Emalt and current crop conditions/impact on crop quality got me thinking about malt barley.

    From slide 16, CWB year end presentation on July 30, Canada exported and processed domestically 1.95 million tonnes of malt barley in 2008/09. 80 % of this was used in N. America.

    From this week's emalt, the following two articles that highlight our challenges going ahead as a malt barley supply chain.

    E-malt article 1

    EU: Malt markets pressured by the abundant barley crop
    With feed barley prices largely at intervention levels (support price) the weight of the sheer size of this year’s EU barley crop has really pressured the malt markets in the last couple of weeks, eFarming reported on August, 9.

    Malt prices reached new lows with increased farmer selling and slack demand.

    While some weather risks remain across Germany and northern parts of Europe, the quality problems that were expected a couple of weeks ago when the harvest was being delayed by rain, have not eventuated. The favourable yields combined with limited downgrading have lead to an expansion in the expected surplus of malting barley this year in Europe, with estimates as high as 3 mln metric tons.

    The higher than expected malt barley surplus may require some malt to be sold into the feed sector and this knowledge has pushed the malt barley premium back into 10 Euros, industry sources report.

    E-Malt article 2: United States & Canada: Decreasing barley acreage and production may make it a specialty crop only for food and malting - analysts
    US barley crop estimates range from 4.1 to 4.4 mln tons this year, analysts communicated earlier this month.

    Canada’s barley production 2009-10 is forecast to reach just 8.7 mln tons.

    Barley experts in the US and Canada point to the steady erosion of barley acreage over the past years. In the late 1980’s the combined acreage was 10 mln ha. This year, 5 mln ha were planted, and a further reduction to 4 mln ha is anticipated for the years to come.

    Barley yields 3.2 tons/HA on average are expected in North America.

    Usage of feed barley will drop fast and deep in the US, experts forecast. There is a risk that barley will become a specialty crop for food and malting, with an obvious supply risk in case of crop failures.

    Barley is already a specialty crop in South America and South Africa, a similar situation in North America would leave only the EU, CIS and Australia as feed barley suppliers to the world.

    #2
    Mistake alert. Total malt barley in 2008/09 was 2.6 MMT of which 1.95 was N. America (850,000 tonnes US and 1.1 MMT domestic). The extra 650,000 tonnes plus some of the domestic malt (off shore malt product sales) are priced competitively with the EU and Australia.

    Comment


      #3
      Hi Charlie
      We are halfway through delivery on the malt barley contract with Coors at £140/tonne taken last September so far so good and we have enough which has right spec to fill the contract.

      They have at least 20% left from last year and are only taking barley already contracted till at least Oct.

      As I understand at the moment there is no premium for malting barley as there are no buyers.

      Feed barley is £80/tonne and again not many buyers

      Perhaps the global recession will affect agriculture after all !

      We all know what a small surplus does to our markets but reduced demand?

      Comment


        #4
        Thanks for comments Ianben.

        Just curious who all signed Cash Plus contracts and at what price? What
        region are you in? Am asking because the CWB indicated in their year end
        report that they/maltsters have already signed up 500,000 tonnes for
        2009/10 (465,000 tonnes in 2008/09). Also suspect based on US and EU
        values that the price is likely under $4/bu for select 2 row ($185/tonne).
        That would represent 50 % of the domestic malt program (assuming no
        export business done under cash plus) or close to 1/3 of the total size of
        the malt barley program (export and domestic) assuming reasonably
        favorable weather that allows decent quality/samples that meet minimum
        selection criteria (highly unlikely to export 3,6 MMT in 2009/10 given
        competition from other exporters and likely a poorer quality crop).

        Comment


          #5
          Should be export 2.6 mmt (similar to 2008/09) - not 3.6.

          Comment


            #6
            Signed cash plus for 6-row to net back $184/T in SE SK.

            Comment


              #7
              We signed some at $240 net delivered back in Jan (Limmited tonnage) then we did some Some at $206 in March and some at $195 May. $206 was recently available in the area. SE Sask. Sounds like our barley crops are some of the better and furthest advanced out there, buyers are likely banking on getting some better quality out of this area in the event of a frost.

              Comment


                #8
                I should mention that was all 2 row Metcalfe

                Comment

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