Slump in lockdown beer demand leaves farmers grappling with a huge barley backlog
PUBLISHED: 05:32 29 May 2020 | UPDATED: 05:38 29 May 2020
The closure of pubs and a slump in lockdown beer demand has created a huge surplus of malting barley in Norfolk’s grain stores – leaving farmers worried about where they are going to put this summer’s harvest.
Maltsters said production is down by about 40pc across the board as demand for this key ingredient has been lost from cask brewers who supply the “on-trade” in pubs, restaurants and hotel bars.
As a result, grain stores are still full of last summer’s malting barley – and that could pose a major problem as the continued dry, hot weather means this season’s harvest could be only weeks away.
James Beamish, farm manager at the Holkham Estate in north Norfolk, said: “Our grain stores are still at capacity. We have got no malting barley coming out of the shed at all.
“Our main malting barley store holds 7,500 tonnes and there is way over 6,000 tonnes sitting in there at the moment.
“It is a very short supply chain and if people are not drinking beer, maltsters cannot move their malt, so we cannot move our barley. Being the primary producer at the start of the food chain, it stays with us.
“Cashflow is one issue. We are holding onto commodities which would normally be going out, with money coming in. The bigger concern is physical storage. Especially with this weather, we are possibly only five weeks away from harvest. “With no rain in the forecast we could see the combines rolling at the end of June.
“We are meeting up with the farmers we farm alongside and with grain merchants to make contingency plans. Temporary stores we normally use at harvest time might need to get used for a bit longer.”
Mr Beamish said one saving grace might be the below-average barley yield expected this year amid the dry conditions – although it might be many months before the surplus can be put to use as pubs and restaurants slowly re-open and recover.
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Adrian Dyter, group managing director at Crisp Malt in Great Ryburgh, near Fakenham, is also chairman of the Maltsters’ Association of Great Britain.
He said while brewers supplying the “off-trade” in supermarkets and off licences have thrived, smaller craft and cask brewers will be “severely impacted” by the temporary demise of the pub trade. The net result is a 40pc drop in trade, leaving Crisp’s Norfolk malting plant running at 60pc of its normal capacity.
“Annually the industry uses about 1.9m tonnes of malting barley, but the AHDB (Agriculture and Horticulture Development Board) has done some work showing about 1.6m tonnes usage across a 12-month period,” he said. “The surplus has blocked storage.
“As an industry we are desperately trying to accommodate as much stock as we can. At Crisp we are shifting stocks around to create space, and we are encouraging our brewer customers to take as much malt as they can, but we are limited by their demand.
“One thing which you could say is a bit of luck, and it is another feature of the weather, is a reduction in the amount of winter-sown crops so the UK is expecting a smaller wheat crop, and there will be storage normally destined for wheat which should theoretically be available.
“On a longer-term basis, the potential yield from this year’s barley crop is likely to be down, so that will actually help as the industry won’t be consuming as much.”
Mr Dyter said Crisp has introduced initiatives to help smaller craft brewers and distillers including extended credit terms, refunds for pallets of unused malt, and offering half-tonne pallets for brewers who are still producing smaller batches during lockdown.
“We will do everything we can to assist people,” he said. “It is a short-term hit for the industry, but we have seen a lot of innovation and a lot of small brewers are very nimble and they are trying things like home deliveries and mail order. We are doing our bit to support them.”
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