Tuesday, September 18, 2007

"US barley acreage has declined to record low levels."

The information that follows has been copied from the Brewers Association Forum Vol. 13-0912, and should be of interest to all readers.

Yesterday we took a glance at sobering news for the hopheads among us.

Today I’m posting a second excerpt from the Forum, this one on the topic of barley malt pricing and availability.

As noted yesterday, none of this is designed to inspire panic or perpetuate doomsday scenarios. Rather, it's useful to nurse the occasional dose of realism about where the beer in the glass comes from, and what it takes to make it.

Chase it with a good beer, and keep your fingers crossed. The planet’s reliance on water is well documented, but so far, I can find no alarming prognostications about yeast shortages.


From: Mike Davis
Sent: Tuesday, September 11, 2007 - 4:26 PM
Subject: Re: 2007: Revenge of the Commodities

Paul Gatza called me recently and I reviewed the many factors that are impacting the supply of malting barley. The world markets are interconnected, so what happens in any major supply area, such as the US, impacts the entire chain. The American Malting Barley Association (AMBA), which is comprised of US malting & brewing companies, works with and knows the US situation, so I will primarily comment on that.

US barley acreage has declined to record low levels, and one reason, as pointed out by Jeremy, is likely the high demand/return for corn for ethanol, which encourages growers to plant corn instead of malting barley. With the barley breeding programs in the US that we collaborate with and support, we stress the need to develop the highest yielding malting varieties so that they will be grown for both feed, fuel, and malting. However, it is difficult to combine all the quality characters our industry demands with high yield, and our industry is slow to change over to new, higher yielding varieties.

Developing high yielding varieties for feed/fuel is easier and quicker and this is the competition we must strive to overcome.

Currently, all malting varieties in the US are spring varieties, but we have winter malting lines in development and testing that can out yield spring varieties up to 25 percent and require one less watering, a big advantage in the West where water is scarce. These winter malting barley varieties, if successful, may be able to pick up acreage that is currently planted to winter wheat in the West.

Another major factor is that federal support to growers, as determined by the Farm Bill, has favored the planting of other crops, such as soybeans, over barley, by providing higher support levels to growers. We are working hard in collaboration with the National Barley Growers Association (NBGA) for more favorable provisions in the 2007 Farm Bill, which will be effective for five years, starting with the 2008 crop. We are pleased that the BA signed on to the joint letter to Congress spearheaded by the Beer Institute, at our urging, encouraging Congress to support the joint AMBA/NBGA Farm Bill positions. The House has passed a version of the Farm Bill that is more favorable to barley and we're now working on the Senate.

Once that is passed, we'll need grass roots support (contacting your members of Congress) to help ensure that the most favorable provisions are retained in House/Senate Conference when the final bill is developed.

Working with the Institute of Barley and Malt Sciences at North Dakota State University, growers in the 3 major US barley producing states were surveyed recently as to why they grow or no longer grow malting barley. Of course, economic return is the most important factor - they will plant crops that give them the highest return, and we must face reality, that there is a lot of competition. Other factors come into play, and we are trying to address those (e.g. developing best management practices to growers to increase their chances of success).

Mike Davis, President
American Malting Barley Association, Inc.

1 comment:

antzman said...

The amazing part of all these crop fields switching to corn is the absolute lack of vehicles on the road able to use pure ethenol. I know I do not have an engine that can use it, and I have no plans to buy a new car so that I might hopefully save a few pennies a gallon.

I was reading last week about the Agave growers in Mexico ripping out their plants to replace them with corn. The agave has a 10 year growing term, so if they decide that growing corn is a mistake, it will be another 10 years after that point that they are mature. What does this mean? An insane rise in the cost of Tequila. This ethanol binge is helping cause a shortage in barley, hops, agave, and who knows what other shortages it will cause in the beverage industry. I guess the one bright point is we will not have a shortage of corn whiskey.