Barley demand tied to Asia's thirst
[Photo by Emma Leonard: Bill Gill, managing director of Joe White Maltings, reports that beer consumption has increased by about two per cent a year, a trend that is likely to continue.]
There is a direct relationship between beer consumption and demand for malting barley, and for the past eight years world beer consumption has increased by about two per cent a year, with no suggestion this is about to change.
Australia represents about 32 per cent of world trade in malting barley and is a key player in the world malt market. Much of this trade is with Asia. Over the past five years China, which only imports malting barley as it is self-sufficient in malt production, purchased the majority of Australia"s exported malt barley. In total, Asia annually imports nearly 500,000 tonnes of malt from Australia. This compares to importing about 180,000 tonnes of malt from France, the next main supplier.
To retain this position in the world market, Australia must continue to meet the market"s demand for product quality and increased quality assurance. Bill Gill, managing director of Joe White Maltings (a company wholly owned by ABB Grain Ltd), Australia"s largest malting company, believes three key elements have helped Australia secure these markets.
"Firstly, Australian malting barley growers now have varieties that more closely meet the demands of our Asian markets," he says.
Brewing is basically a conversion and fermentation process, where the malt is converted to sugar, which is fermented to produce alcohol and carbon dioxide. The malting process makes the starch in the grain accessible for conversion and at the same time produces the complement of enzymes required in the brewing process.
Most breweries use an adjunct with the malt of about 15 to 20 per cent of the wort. Unlike Australian brewers, who mainly use liquid sugar in the brewing process, Asian brewers use maize and rice grits as adjuncts. This puts a higher demand on the malt, as a greater concentration of enzymes are required to rapidly break down the starch in the adjuncts during wort production.
Varieties such as Baudin and Gairdner are designed to have higher enzyme levels while meeting the demands of the maltsters and growers.
"Secondly, we have increased tonnage of these varieties, giving us a regular and sizeable pool of "malt one" to select our barley from for malting or exporting," Mr Gill says. "And thirdly, the Australian malting industry has lifted its game and has now implemented world-best practice in malt production."
But Mr Gill cautions that we cannot become complacent because in reality Australia is simply remaining competitive and not gaining ground on Canada and Europe, our biggest competitors in Asia. In Japan, a highly competitive malt market, customers are already moving towards traceable grain, a criterion Australia needs to address.
"There are already good quality assurance (QA) systems available for grain production, but growers who are avoiding adopting QA are just putting off the pain. As markets start to demand QA it will be used as a tool to retain or gain markets; if Australia cannot provide QA grain or malt, that could mean losing markets." Mr Gill hopes that in five years about 30 per cent of the malting barley on the market is from farms with QA programs in place. He says QA systems are about improving quality food safety, and in his business he has found that the systems help to improve efficiency and create cost savings. "Customers are not going to pay for QA but effectively implementing QA can pay for itself."
Figures quoted in the article are based on statistics from the World Barley, Malt & Beer Conference, 2005.
Varieties displaying this symbol beside them are protected under the Plant Breeders Rights Act 1994.