RSS
Twitter
Linked In
News In
Features
Linked In
RSS
https://twitter.com/Agrimoney
http://www.newsnow.co.uk/h/Industry+Sectors/Agriculture

You are viewing 1 of your 2 complimentary articles.

Register now to receive full access.

Already registered?

Login | Join us now

EU short in high-protein malting barley - despite higher yields

Twitter Linkedin

Have malting barley seed developers overcome one challenge only to create another?

Companies such as KWS, Limagrain and Syngenta have made large progress boosting the yield potential for growers, helping ensure a world an exportable malting barley surplus forecast at 810,000 tonnes as of the close of 2015-16 by specialist broker Evergrain.

However, the improvement appears to have come, in part, at the expense of protein levels, which are often falling below the 10-11% level desired by many brewers.

"While Europe has a surplus of malting barley, the shortage of high protein barley, above 10.5%, is an increasing issue for the industry and the export customers," Hamburg-based Evergrain said.

New market

The shortage in protein, which is needed at minimum levels to ensure ideal yeast development, has been noted in particular in the UK in 2014, and last year in Argentina and in Scandinavia - where, in Denmark, a curb on fertilizer use exacerbated the problem.

And it has opened up a secondary market in higher-protein barley, with buyers now able to purchase in advance supplies with protein guaranteed at, say, 10% - mirroring the structure long seen in the wheat market.

"While you used to have a standard malting barley specification, you can now allow for a minimum protein level," an Evergrain spokesman said, noting an additional premium of perhaps E5 a tonne for such an assurance.

Gap in premiums

That would represent quite a chunk of the premium which farmers are seeing for 2015-crop spring malting barley, which is selling for E5-15 a tonne more than feed barley, although forward sales for the next harvest are currently enjoying a bigger advantage, of some E25-40 a tonne.

"The bigger premium for new crop represents the uncertainty, given that much of it is not yet in the ground yet," the Evergrain spokesman told Agrimoney.com, adding that farmers selling had been low "throughout Europe" too.

However, the large new-crop premium "will correct itself [lower] over the next couple of months", as harvest approaches.

The broker forecasts the European Union, a large malting barley shipper, producing 9.29m tonnes of spring malting barley this year, a drop of approaching 400,000 tonnes, reflecting a fall in sowings.

Export prospects

Nonetheless, the harvest will produce an exportable surplus of 500,000 tonnes of spring malting from the forthcoming harvest – enough, factoring in carry-in stocks, to support EU shipments of 850,000 tonnes in 2016-17.

Exports of winter malting barley were forecast at a further 1.0m tonnes on top.

Australia was forecast retaining top rank in exports, at 1.9m tonnes – although this volume includes large volumes of so-called "fair average quality", or FAQ, supplies accepted by many Chinese buyers.

By Mike Verdin

Twitter Linkedin
Related Stories

Can cotton prices extend their rally?

History suggests futures will not stay long in the 70s cents a pound. So which way will they trend?

Morning markets: Hard wheat regains premium over soft, amid US dryness worries

Kansas City wheat outperforms, as Plains precipitation worries extend to a dearth of snow cover. But Kuala Lumpur palm oil hits a 16-month low

Evening markets: Ags gain, as funds begin to get that year-end festive mood

Ag prices recover, helped by the likes of more positive comment on US export competitiveness, and some more negative talk on Argentine rains

Morning markets: Grains stage a recovery. Will it last?

Corn, soybean and wheat futures start Wednesday making headway which has been difficult to come by of late. Cotton gains too
Home | About | RSS | Commodities | Companies | Markets | Legal disclaimer | Privacy policy | Contact

Our Brands: Comtell | Feedinfo | FGInsight

© Agrimoney.com 2017

Agrimoney.com and Agrimoney are trademarks of Agrimoney Ltd
Agrimoney is part of the Briefing Media group
Agrimoney Ltd is registered in England & Wales. Registered number: 09239069