“Not as discriminating”
Grain companies and maltsters in Western Canada are already working toward having a “fair average quality” class of barley, as the Chinese market has been buying lower-quality malt barley from Australia for several years, said Green.
The looming end of the CWB single desk at the start of the 2012-13 crop year on Aug. 1 is helping speed up the move toward more “fair average quality” barley, said Green. Additional players in the export market, he noted, will mean those demand niches that may have been overlooked by the CWB in the past will now be filled by the commercial trade.
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“Australia recognized there was a market for ‘fair average quality’ medium-range malt quality barley five years ago,” said Warner, Alta. farmer Brian Otto, president of the Western Barley Growers Association.
Malt companies in China and other areas, he said, were “not as discriminating for quality as malt plants in North America or Europe.”
Canadian barley is recognized for its quality in the world market, said Otto, but the additional market for lower-quality malt barley will help create additional revenue for producers.
While it may not happen overnight, he estimated that the “fair average quality” malt barley would allow the amount of the Canadian crop accepted for malting to increase by at least a million tonnes, from the current average of 2.1 million tonnes.
Annual Canadian barley production (both malt and feed) has declined in recent years, with only about 7.7 million tonnes grown in 2011-12. Otto predicted that number could increase back to the 12 million-tonne level under an open market, as the lack of the CWB single desk and increased competition will allow international market signals to find their way back to the farm in a more transparent manner.
Demand for special varieties from craft brewers and the declining U.S. barley area will also create need for more barley acres, he added.
“More eyes are better for specialty markets,” added Errol Anderson of ProMarket Communications in Calgary, noting that the increased competition in the malt market will be beneficial for barley growers.
