The situation in the barley and malt market remains very difficult. Unfavorable weather conditions have affected the recent harvest nearly everywhere in the world as stated in the crop report issued today by specialty maltster The Swaen. While Canadian and USA crops suffered from dryness, the crop in Europe was impaired by too much rain.
The rainy summer in wide parts of Europe delayed the crop by several weeks and caused massive losses of barley not only in terms of quality but also in quantity. Estimations are that the total available volume of brewing barley is roughly 30% lower than usual, according to The Swan. The malting barley production in the EU is now estimated at 9.9 million tons for crop 2021 (EU27) vs. 14.0 million tons in crop 2020 (EU28)
Next to the low volume the quality of the crop is a major concern. Bad weather conditions during the growth period of the spring barley in Europe have resulted in 5-10% smaller grains compared to previous years. Since the small grains are not suited for malting, they have to be sorted out which results in a reduced yield and hence a higher barley and malt price.
Rain during harvest favored not only the growth of fusarium, which induces gushing, but also pre-malting. Pre-malting is the case when the barley begins to germinate before harvest. These grains often do not germinate a second time, and the presence of 5% or more germinated grains may make the lot unsuitable for malting.
This year’s protein levels are mostly at an acceptable level between 9.5% and 11.5%.
With the low volumes and poor quality in the EU crop as well as the US and Canadian crop the malting barley and malt market is expected to remain very tight. Euromalt, the European Malting Association has calculated a deficit of 200.000 tons of spring barley this year for the production of malt in the European market.
This worldwide deficit can be partly compensated by barley grown in the southern hemisphere, namely Australia and Argentina where the growing season has just started. Although it is still too early for firm predictions, the outlook so far remains positive.
Due to the difficult conditions the price of spring barley FOB Creil has increased from EUR 180 per ton to now EUR 360 per ton. The Swaen expects the price to remain stable or to increase even more until the next crop if there is no relief from bumper crops in Argentina and Australia.