Around 250,000t of Irish barley is used in the drinks sector each year, with an ex-farm value of €48m, according to a new report published this week on the economic contribution of the tillage sector.

On average, growers plant 40,000ha worth of malting barley each year, producing 287,000t of grain see (Table 1).

The report outlines that between 2014 and 2018, annual rejection rates were around 7% of total malting barley production due to failure to meet the required specification.

During the reference period, imports of barley for malting were confined to 2018 only, when 65,000t were imported due to a deficit of native barley caused by drought conditions.

This indicates that the total net supply (including imports) of barley to the drinks industry is 265,000t per annum.

This figure includes 180,000t used for malt production for brewing and distilling and 45,000t in roasting for stout production. A further 40,000t per annum of unmalted (raw) barley is used in distilling.

Table 1: Estimated supply and use of malting barley (annual average 2014-2018)

Sources: production data from CSO, trade data from Eurostat, use data from industry consultation. Figures are estimates and should be interpreted as approximate magnitudes only.

Note: 1. Dry weight after allowing for an estimated average rejection rate of 7% due to missing malting specification or over contracted tonnage. Rejected tonnage assumed feed grade and price. 2. Value is subject to year to year variability based on harvested volume and quality of domestic malting barley. Industry sources estimated imports of over 65,000t for 2018 but negligible import quantities in the other years (ie 2014-2017). 3. Calculated at 0.76t of malt per tonne of malting barley.

Premiums

Between 2014 and 2018, the average price premiums paid to growers were €23/t for barley accepted for malting and €10/t for roasting barley.

However, the report notes that producers say that this premium is partially offset by the opportunity costs (potential margins from higher yielding competing crops) and additional management risks such as rejection rates for grain that does not meet the tight malting specifications.

The report states that Ireland’s alcohol industry generates over €1bn in exports, supports over 92,000 jobs (directly and indirectly), and contributes over €2bn to the economy.

Maize

Maize is a significant raw material in Irish distilling, and it was estimated that net imports of this crop for distilling were 115,000t per annum during the reference period.

Overall, native grain as a percentage of all grain used by the combined brewing and distilling industries averaged 65% during the reference period.

More specifically, native supply accounted for more than nine in every 10 tonnes of grain used for Irish brewing and four in 10 tonnes of grain used in Irish whiskey distilling.