Maltsters

[grampamark]

Here’s a point of reference (and the reason we haven’t grown malt barley on our farm for the last 5 years).

That’s Wednesday’s closing market price for malt and feed barley at the nearest grain elevator to our farm. The prices are quoted per hundred pounds (abbreviated cwt). So, malt, per pound, is $0.0775. Note that feed barley is only $0.75/cwt less than malt. The “N/D” column indicates November/December delivery. The next column to the right (not in the picture) is empty, so no set price beyond next month.

The standard “test weight” (the assumed weight per bushel for purposes of trade) for barley is 48 lbs. So, a cwt of barley contains 2.08 bushels. $7.75 / 2.08 = $3.73 / bushel. Spring wheat, our principal crop is currently $10.00 / bushel (wheat is traded by the bushel; don’t ask). In an average year we can produce around 40 bushels of wheat per acre; at current prices that’s $400 / acre. Barley will average closer to 60 bushels / acre, but at $3.73 / bushel that’s only $223 / acre. Production costs are similar for both crops. One doesn’t need to be a Nobel-worthy economist to figure that one out.

Current malt prices, at the HB level, for base malts are anywhere from $1.50-2.00 / lb. So, retail malt prices are close to 20X what the grower receives. Transportation, storage, processing, packaging, more storage, more transportation, more storage, and, finally, more transportation before that sack of malt arrives at your door. There’s a lot of middlemen in the supply chain.

Edited to correct the price/lb of malt. Left out a “0”.

 

[MaxStout]

Just like your groceries. When you're standing in line at the supermarket, that extra $$ you're ponying up isn't going to the farmers.

 

[BrerRabbitBrew]

I'm using Great Western 2-row right now. I think it's great!

 

[lurker18]

I really admire your home malting operation, and not only for economy reasons. The dryer saga was especially inspiring - closer to the dirt! Kinda weird that barley price stays the same while malt price goes through the roof. wtf?

Barley prices definitely have not stayed the same. Harvest 2020 we were buying selected malt barley from the producers for $5.50/bushel. Harvest 2021 we are buying barley from the producers at $11.50/bushel right now, and there is aprox. 50% less of it to buy due to the terrible growing season. Add to the all the processing costs have gone way up, natural gas, transportation, the magic supply chain issues, etc. the cost for malt to the consumer has to go up.

I am a malt selector, and have been doing this for about 10 years now, and this is by far the worst year I have ever been involved with in buying quality barley. Malt houses are struggling to purchase the raw products, are working with barley that they normally would not touch for malting, and are doing a pretty good job of making the final product. I can't see prices coming down anytime soon, at least until next harvest assuming we get back to "normal" weather trends and normal harvest volumes and quality, but just as a heads up, our company has just sold next years new crop at this same prices as this years crop, so I assume the maltsters are preparing for an equally challenging 2022 -2023, keeping the price of malt up there for at least another year.

Those who would like to see the prices go down better be doing a rain dance, putting all their wishes that COVID f*cks off, and transportation costs level out.