Winnipeg, June 16 (CNS Canada) – Consistent demand from the craft brewing industry means solid malt barley contract prices for Canadian farmers, which in turn has driven up acres this year.
Maltster-demand has been well-met so far this year, one market participant says.
Demand from the craft brewing industry is keeping malt barley prices supported at a time when demand for beer in North America and Europe is mostly flat, said Rod Green, manager at Central Ag Marketing Ltd.
He added that malt barley is increasingly becoming a specialty crop that’s contracted in advance of the required time of movement.
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New crop malt barley prices are being offered between $5.05 and $5.25, according to data from Prairie Ag Hotwire.
“It’s a good return and that’s why you’re seeing barley acres gradually increasing,” Green said.
Barley seeded area (including feed) is estimated at about 6.8 million acres this year, up from 6.5 million in 2015, according to data from Statistics Canada.
“The maltsters are well-covered for their needs for the summer,” Green said.
Farmers are closely watching crop-conditions, as chitting, or pre-germination in the past couple years caused supply to fall short of demand and drove spot malt barley prices higher.
Chitting is when barley starts to sprout inside the kernel and dries out.
“The whole essence of the malt barley business is to get as many kernels switched from starch to sugar as possible, but it’s not supposed to happen in the fields,” Green said.
