Written by MARGARETT WATERBURY
A Tough Season for Malting Barley Highlights Supply Chain Vulnerabilities O
regon State University professor Pat Hayes doesn’t mince words when it comes to the North American 2021 barley harvest. “It was a bloodbath,” said Hayes. “If [Martin] Scorsese did a movie about malt, 2021 is what it would look like.” The size of the crop in major North American barley growing regions (which includes Idaho, Montana, Wyoming, Oregon, Washington, Alberta, Saskatchewan, and British Columbia) shrank about 40 percent between 2020 and 2021. Heat and drought were the major culprits. Dryland growers were hit especially hard, but even irrigated barley suffered in the extreme high temperatures that descended on the inland Northwest last summer. “In some places you just couldn’t get enough water onto the crop to deal with the water demand because of the heat,” said Hayes. Other regions, such as Oregon and California’s Klamath Basin, lost access to irrigation water altogether. Adding insult to injury, widespread rain just before harvest led to pre-harvest sprouting, which is when the grain starts to sprout while it’s still on the head. The resulting
crop is both smaller in quantity and higher in protein content than expected, leading to a painfully familiar set of circumstances in the COVID-19-disrupted economy: Reduced inventory and higher prices. Many of the largest malt suppliers have sent out pricing notices telling customers to expect to pay more for malt in the months to come, and to get in orders well in advance. “The reduction in 2021 barley crop availability will mean supplies will be very limited over the course of the year,” said Scott Garden, director of research and technical services at Great Western Malting Company. “For some maltsters, imported barley may be necessary to ensure supply.” Imports might help avoid a shortage, but they probably won’t keep prices down. Global trade continues to be rattled by slowdowns in ship and truck transit. Barley in particular was also impacted by a 2020 trade dispute between China and Australia that led to a Chinese tariff of more than 80 percent on Australian barley, which led many Chinese companies to shift their purchasing to other sources and altered
the global trade balance. At the same time, 2020 sales of alcoholic drinks increased 23 percent in China, which the Financial Times reports was the largest increase of any major market. That, in turn, boosted demand for malting barley in China so acutely that some maltsters turned to feed barley to fill the gap, a situation Nikkei Asia described as “unprecedented.” Intense demand led to a willingness to pay more, driving up malt barley pricing in exporter nations around the world. American distillers and brewers are already starting to see the effects. Campbell Morrissy, head brewer at pFriem Family Brewers, says he’s seen “across the board” increases in malt prices impacting everything from workhorse base malts to the specialty malts pFriem relies on to brew around 100 styles of beer each year. That’s taking place against a backdrop of higher prices on many other supplies, including cans. “Nothing is reliable anymore,” said Morrissy. “You have to be really tight on incoming materials. You can’t just place a phone call and hope it shows up.”
“The reduction in 2021 barley crop availability will mean supplies will be very limited over the course of the year. For some maltsters, imported barley may be necessary to ensure supply.” —SCOTT GARDEN
Director of research and technical services, Great Western Malting Company
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