Australian barley courts Latin America ahead of harvest

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A crop of Spartacus barley grown in Australia in 2020. Photo: Quadra Australia

Australia’s barley industry makes a concerted effort to sell malting barley plots large and small in Latin America as the 2021 harvest accelerates and Australian barley exporters enter their second year without China.

To showcase its merits to the booming market, the Australian Exports Grains Innovation Center (AEGIC) hosted its first sales boosting webinar this morning.

Entitled ‘Australian Barley: Adding Value to the Malting and Brewing Industries of Mexico and Colombia ”, he delivered a compelling sales pitch.

Low humidity, backed by quality assurance, suitable varieties and a reliable supply were the assets.

Chance to build

Western Australia’s CBH Group sent its first shipment of malting barley to Mexico in January. Until August 31, Australia had shipped around 141,000 tonnes to Mexico.

This puts Mexico on track to become Australia’s biggest maltster client for 2020-21, ahead of Vietnam with around 123,000t in the same eight months.

Other Latin American countries also provided significant support, Ecuador importing 12,000 t and Peru 76,000 t.

China has disappeared as a market for Australian barley, and Saudi Arabia, a feed buyer, was Australia’s largest market for 2020-21. Source: AEGIC

These tonnages are pale when put alongside China’s pre-tariff imports of Australian malting barley – around 2 million tonnes (Mt), or about half of the Australian malting barley crop – they are extremely important in today’s global market.

It readjusted to China closing the door to Australia as the main supplier of malting barley and increasing its imports from origins such as Argentina, Canada, France and Ukraine.

Mexico remains the largest market for malting barley in the United States, purchasing more than 350,000 t per year, and the United States remains Mexico’s largest export market for beer.

Mexico malts its own malting barley and has traditionally imported additional tonnage from Europe and the Black Sea.

It is a growing market, as evidenced by the construction by Malteurop of its first Mexican malt house, a 120,000 t / year plant in Meoqui.

Part of its production will be subject to a long-term contract with Heineken, which was the destination for malt made from CBH’s first shipment.

Barriers that fall

Australian Ambassador to Mexico addresses AEGIC webinar Remo Moretta, Agricultural Counselor of the Australian Embassy in Mexico Kate Makin, and Australian Ambassador to Colombia Erika thompson.

Mr. Moretta said the Trans-Pacific Partnership, with Australia and Mexico among the signatories, has widened the door to trade.

“Relations between our countries are developing … so that both countries can access markets and diversify their trade,” said Mr. Moretta.

Although Colombia is yet to appear as an importer of Australian barley, its brewing sector is dynamic and Ms Thompson said a reduction in its tariffs was to be expected as her negotiations in the Pacific continued.

“We understand that there is a lot of interest here in Colombia to reduce the tariff,” Ms. Thompson said.

“We are very interested in the process and we are anticipating something at least in the coming year.”

Insurance in abundance

Australian barley production in recent years has seen around 4 million hectares planted to produce around 10 million tonnes, making it the country’s second crop behind wheat.

The Australian webinar presenters were the AEGIC Barley Markets Manager Marie Raynes, Executive Chairman of Barley Australia (BA) Dr Megan Sheehy, and Managing Director of Grain Trade Australia Pat O’Shannassy.

Ms Raynes and Mr O’Shannassy made it clear that Australia is a reliable and high quality grower, while Dr Sheehy walked through BA’s variety assessment process, which ensures customers a product suitable for the ‘use.

Mrs Raynes assured those listening that Australia could be relied on to deliver white, shiny and fleshy two-row barley with protein of an ideal 9-12pc.

“We have dry cereals that are safe for food and feed. “

Ms Raynes said the 95% varietal purity – “even higher if under contract” – was also assured.

Of the malting barley planted across Australia this year, the Spartacus variety is considered to represent 37 pc of the area, RGT Planet 32 ​​pc and Compass 15 pc.

Australia is on track to produce 12.5 Mt above average barley from the current harvest in all states on the continent except Victoria.

About 35% of the national harvest can generally be classified as malting, and most of it is exported.

Based on the latest ABARES estimates for combined feed barley and malting barley production, WA is expected to produce 4.9 Mt, South Australia 2.2 Mt, Victoria 2.3 Mt, New South Wales 2.7 Mt and Queensland, rarely an exporter, 377,000 t.

Ms Raynes said the varieties planted gave an indication early in the growing season of how much malting would be produced.

“Forecasting the production of barley varieties contributes to informed sourcing decisions for business enterprises.

“Whatever your needs, there is a variety of Australian malting barley to meet your needs.

“Rest assured that you will have regularity of supply.

“If you are using Spartacus and RGT Planet, this variety will still be available in a few years.”

Australian Malting Barley Exports 2020-21. Tons. Source: AEGIC graph of ABARES data

Barley Australia’s membership includes major Australian seed companies, maltsters and brewers, and Dr Sheehy said the recent incorporation of Pilot Malting Australia into the Stage 1 varietal assessment was important.

“The involvement of Pilot Malting Australia in the design of the program is absolutely essential; it was extremely beneficial for the program and it really took the program to the next level.

Dr Sheehy said that the involvement of the malting members in Step 2 was also crucial.

“Nothing can replace variety testing in a commercial facility.

“We don’t do a market suitability assessment: we assess whether this variety can produce malt and beer. “

Dr Sheehy reviewed the many varieties being evaluated for accreditation for malting, and said this was necessary to meet different growing regions and market demands.

“It is important to have a range of agronomic performance and varieties, and a range of malt quality.

“We believe we provide options for both the producer and the market. “

Dr Sheehy said that the craft brewers do not use any adjuvants in their process, but some commercial brewers require high fermentability because they use a large amount of adjuvant, and the Australian industry could produce barley to meet the demands. these two applications, and those in between.

Containers could open the door

CEO of GTA Pat O’Shannassy said Colombia had previously been a market for Australian wheat and hoped it would become a barley customer.

“It will be really good to commit to this level again,” said Mr. O’Shannassy.

He said containers typically made up around 10-12% of Australia’s grain exports and could be a good way to get the ball rolling.

“There is a way to start a business in Australia and… it can start with containers. “

He told the webinar audience that drought and quality assurance were hallmarks of Australian malting.

“Lower humidity is one of the advantages we have over our international competitors. “

He said “every truckload” of grain in Australia has been sampled and tested once it leaves the farm.

“Barley is sampled religiously… through this supply chain as well. “

The shipping time for Australian barley to Latin America is considerably longer than anywhere in Asia, and that has an advantage.

As Executive Director of the Grain Industry Market Access Forum Tony russel underlined, it allows fumigation on board.

“It certainly gives exporters more flexibility and makes it more efficient.”

Ms Raynes said AEGIC intended to host another webinar involving Latin America in February-March and incorporate a roundtable with some of its maltsters and brewers.

“We want you to learn more and gain value. “

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