The U.S. Grains Council held their Barley Sector meeting last month to discuss barley crop production updates, barley updates from other countries, and organization updates. Here are a few notes from the meeting covering the barley crop production update, and China and Mexico updates.
Barley growers and state staff from the barley producing states provided a general summary of 2022 crop conditions and outlook for the 2023 barley crop.
- In North Dakota, the 2022 barley production was 120% greater than 2021. Growers in general reported good yields and quality. Contract prices for 2023 were initiated in September 2022 in the area of $8.00 per bushel. Pet food contracts are currently in the $5.00 to $6.00 per bushel range. Snowfall is providing adequate moisture to start the crop in 2023, and growers are guardedly optimistic as acres may increase slightly in 2023.
- In Montana, the 2022 barley crop was generally good, although pockets of drought still exist. Mountain snowpack is generally adequate. Growers are optimistic for favorable barley crop conditions for 2023.
- In Idaho, barley prices remain strong and thus increased acres in 2023 is likely. Moisture is adequate and growers are optimistic for a good crop in 2023.
USGC China country director Manuel (Manny) Sanchez provided an update on the barley situation in China.
- Beer production continues to increase in China, and is currently 356.24 million hectoliters per year.
- Craft beer production is growing in China, comprising annual usage of approximately 175,000 metric tons of malt (approximately 2.5% of total malt consumption).
- Industrial brewers (high volume) utilize approximately 2,433,000 metric tons of malt annually.
USGC Mexico consultant Javier Chavez provided an update on the barley situation in Mexico and related activities to promote U.S. barley.
- Beer production increased 4.8% in Mexico from 2021 to 2022.
- Mexico exported 38.5 million hectoliters of beer in 2022, 80% of which went to the U.S.
- Modelo and Heineken have assisted in increasing barley production in Mexico 26% since June 2017.
- Barley production is increasing in the state of Chihuahua. Chihuahua is the 5th largest barley producing state in Mexico. It is anticipated that Chihuahua barley production will supply 50% of the requirements for the new Heineken / MaltEurop facility being constructed in Chihuahua.
- Heineken has been importing barley from Australia, since Australia needs a market outlet due to the current trade dispute between China and Australia.
- Of note, Ukraine and Argentina became the primary suppliers to China. However, Ukraine exports to China declined from 2.8 million metric tons in 2021 to zero in 2022.
- Mexico malt imports for 2022 were reported as follows:
- United States: 316,228 metric tons (53% market share)
- Canada: 89,543 metric tons (15% market share)
- China: 31,299 metric tons (5% market share)
- EU: 112,379 metric tons (19% market share)
- The new malt facility in Chihuahua, which is a joint effort between Heineken and MaltEurop, is expected to be operational in June 2023. This facility will have an annual capacity of 120,000 metric tons of malt.
- Craft brewing in Mexico continues to expand, as evidenced by 21% growth in 2021. There are currently 1,938 craft brewers in Mexico.