Coronavirus: Drinks sector barley use sinks to 10-year low

Barley use in the brewing, malting and distilling sector has fallen to the lowest level in more than a decade, figures released by AHDB Cereals show.

Figures for April – the first full month showing the implications of the Covid-19 lockdown – reveal just 114,700t was used by the sector.

See also: Big crops, brewing slump and weather affect barley outlook

The last time monthly barley use in the brewing, malting and distilling market fell below 120,000t was August 2009, when 111,500t was used. April 2020’s figure is 28% lower than the same month last year.

The sharp decline in use was driven by the fall in demand into the food service sector, according to AHDB analyst Thomma Shepherd. Maltsters have reduced production levels, as the demand has dried up and some distilleries have pulled forward scheduled closures.

“With current indications suggesting no reopening of pubs and restaurants before 4 July, it is likely that we will continue to see this reduced demand for the rest of the 2019-20 season,” Ms Shepherd said.

Taking this reduced demand into account, the May balance sheet estimate puts total human and industrial use for barley this season at just 1.8m tonnes.

That suggests a drop of 117,000t against February’s estimate, made before the full effects of the coronavirus pandemic began to unfold.

It is also 4% lower than the previous five-year average of 1.89m tonnes. If that forecast is realised, it would be the smallest figure since 2010-11, Ms Shepherd said.

“This is not good for a large production year and likely to weigh on barley closing stocks, which are currently forecast to be the largest since 2014-15,” she added.

Estimates suggest the closing stocks for the 2019-20 season could be 1.22m tonnes, compared to the 2014-15’s previous high of 1.37m tonnes.

Upcoming webinar

SEPTEMBER
30

What does the future of farming look like post Covid-19 and Brexit?

Register today