Global market of malt barley Essay Example for Free

Global market of malt barley Essay Annual international trade of barley averages around 15 million metric ton and fluctuates from 12 to 16 million metric tons. This is about 9 -12% of total global production. Major exporters are EU, Australia, Ukraine, Canada and UK. US is neither a major exporter nor a major importer. Its export and imports are more or less same. US export mainly the feed barley and imports malt barley. The annual trade of feed barley comprises more than 75% of total barley trade while that of malt barley accounts for less than 25%. China and US being leaders in beer production account for over 60% of malt barley trade. China alone imports 50% while US about 11%. Leading Barley Import and Export Countries (Averages for 1998-2000) Country Imports (Mt x 1,000) Country Exports (Mt x 1,000) Saudi Arabia 4447 France 6758 Japan 2531 Germany 4040 China 2160 Australia 3973 Belgium-Luxembourg 1459 Canada 2196 Russian Federation 1005 United Kingdom 1898 Germany 941 Belgium-Luxembourg 1223 Brazil 880 United States 985 Netherlands 823 Denmark 960 Morocco 794 Ukraine 841. Italy 790 Turkey 659 United States 778 Sweden 606 Table 4: Global trade of barley in 1998-2000 (faostat) Sourcing Barley for Beer Production Malting companies in US processes about 3 million ton of malt barley annually of which about 1. 0 million ton is imported barley and the remaining (about 2 million ton) is produced in US itself. Therefore, a beer company in US should keep both the options – of sourcing from within the country from states like North Dakota, Montana and Idaho etc. and of importing open for sourcing barley. When it comes to import Canada should be the obvious choice due to geographic proximity. The next obvious choice has to be EU. As far as sourcing from domestic market is concerned the company can have a direct contract with major barley growers to save cost and ensure a reliable supply. In case of import from Canada the concerned agency is Canadian Wheat Board. Concerning Outsourcing of the product, a beer company should focus on Malting, Brewing, and Fermentation etc. instead of imports and domestic purchasing of commodities. Therefore, it is always better to outsource the product to a few good commodity trading companies. The commodity should be outsourced not to one company rather to more than one company to have a bargaining power over pricing and also to ensure a uninterrupted supply of barley in case of any unforeseen crisis to keep the brewery running. There can be another outsourcing approach for a new start up Beer Company. With malting being an established process. There are dozens of malting companies in US and hundreds on the globe and malt being a standard product being traded in the market globally. Therefore, for a start up Beer Company it will be a good idea to focus on brewing and fermentation, rather than going for setting up the malting facility. If the company specializes on producing better and special quality beer it can command better price for its beer and that business model should be more profitable than starting fro malting. Some important malt barley and malt suppliers in US are – 1. North Dakota Barley Council 2. Americas Malt, PO Box 5724 Minneapolis, MN 55440-5724 Tel: 1-952-742-5646 Fax: 1-952-742-5050 Internet: www. Cargill. com. Products: Barley Malt 3. Busch Agricultural Resources, Incorporated P. O. Box 427 West Fargo, ND 58078 Tel: 1-701-282-5752 Fax: 1-701-282-6260 Products: Malting Barley 4. Cargill, Inc. P. O. Box 9300 Minneapolis, MN 55440-9300 Tel: 1-952-736-8664 Fax: 1-952-742-6252 Internet: www. Cargill. com Products: Feed Barley, Malting Barley 5. Cenex Harvest States P. O. Box 64089 St. Paul, MN 55164-0089 Tel: 1-651-306-6156 Fax: 1-651-306-6570 Internet: www. harveststates. com Products: Feed Barley, Malting Barley 6. Columbia Grain 111 S. W. Columbia St, Suite 1200 Portland, OR 97201 Tel: 1-503-224-8624 Fax: 1-503-241-0296 Products: Feed Barley, Malting Barley 7. ConAgra Grain Companies 400 4th Street, Suite 850 PO Box 15083 Minneapolis, MN 55415 Tel: 1-612-341-2326 Fax: 1-612-341-2137 Products: Feed Barley, Malting Barley 8. ConAgra Malt P. O. Box 1529 Vancouver, WA 98668-1529 Tel: 1-360-699-9389 Fax: 1-360-696-8354 Products: Barley Malt 9. Coors Brewing Company 17755 West 32 Av. Brewing Materials BC 610 Golden, Colorado 80401 USA Tel:1-208-678-3586 Fax : 1-208-678-9669 Products: Malting Barley, Barley Malt 10. General Mills Operations, Inc.