Europe: Malting industry sold out well into 2021

Malt is in high demand in Europe. Malt plants in export locations close to seaports are already sold out for 2020 and well into 2021 and maltsters cannot respond to inquiries from domestic and international brewers. As a consequence, many brewers have concluded long term agreements (LTAs) for the coming years to secure malting capacities.

“Because of higher malting barley prices for new crop barley, brewers have only bought approx. 25–30 % of their 2021 malt demand at fixed prices but the total committed malting capacity incl. LTA’s is closer to 60-65 %,” Holger M. Gauger estimates in his last market report.

As a consequence, malting margins have improved for maltsters and exceed in some cases even the EUR 100 mark for favored malting locations. “Average prices of crop 2020 malt range from EUR 390 to 420 both delivered to domestic breweries and FOB seaports,” according to Gauger.

Since 42% of the global malting capacity of around 23 million tons is located in the European Union (source Euromalt 2017), the capacity utilization of the EU malting industry is a significant factor for malt prices in the world.

According to TAXUD, the Taxation and Customs Union of the European Union, major export destinations for European malt by Oct 28 were Japan (68,000 t), Vietnam (54,000 t), South Africa (36,000), Ethiopia (36,000) and Mexico (30,000) [all figures in in grain equivalents].

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