South Africa: Grain SA files complaint against AB InBev

Grain South Africa has filed a complaint against AB InBev with South Africa’s competition watchdog. The farmers lobby group claims that the world’s leading brewer has contravened one of the conditions set by the country’s competition tribunal at the acquisition of SABMiller in 2016. Reportedly AB InBev,  which buys 85 to 90 percent of the malting barley grown in South Africa, has changed the pricing formula, which was set by SABMiller in 2009 and which is tied to the price of wheat futures on the Johannesburg Stock Exchange. Grain SA complains that the price of barley is now about 100 rand (about US$ 8) per ton lower compared to the old formula.

“We are of the opinion that they are not sticking to what was agreed at the Tribunal,” explained Jannie de Villiers, Chief Executive Officer of Grain SA to news agency Reuters.

AB InBev plans to secure in South Africa 415,000 tons of malting barley in 2018 with the remainder coming from Australia and Canada. As part of the takeover conditions the company has agreed to increase the amount to 475,000 and hopes to be self-sufficient with SA’s barley beyond 2021.

 “We have, at all times, conducted our operations in compliance with the conditions imposed by the Competition Tribunal,” said AB InBev Africa spokeswoman Robyn Chalmers.

 

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