Boortmalt has today announced that it will no longer produce C1 malting barley seed and will instead increase its intake of green malting barley.
In a statement to the Irish Farmers Journal, the largest malt manufacturer in the world has stated that it will outsource seed production to two seed assemblers, Goldcrop and Wm Connolly & Sons.
Once repair work to the damaged malt facility in Athy, Co Kildare, is competed later this year, the company expects malt production to rise by 30,000t to approximately 140,000t.
However, in order to operate at full capacity, Boortmalt expects that it will have to source in excess of 185,000t of green malting barley annually.
Despite expanding its existing growers base to include parts of Cork, Waterford, Dublin, Louth, Donegal and Tipperary, the company believes that sourcing this increased volume from 2020 onwards will be "extremely challenging".
The damaged malt facility in Athy is expected to be operational later in the year.
Boortmalt group operations officer Peter Nallen said: “To allow Boortmalt to access a greater volume of green malting barley annually, we have made the decision to cease direct contracting for C1 seed production with immediate effect.”
He continued: “We did not come to this decision lightly given our long history in C1 seed production. However, the company’s viability is contingent on meeting the current and future needs of our distilling and brewing customers in Ireland.”
Approximately 40 growers had contracts to produce C1 malting barley seed for the company.
Traditionally these growers received a premium over the malting barley price. In 2018, for example, growers were paid €17/t over the price of malting barley for their seed crop.
In place of seed contracts, Boortmalt is offering its network of contracted seed growers a new malting barley contract tonnage to include the additional acreage currently used for seed production.
“We believe this decision will ensure we source enough local malting barley that in turn allows us to provide our customers with local Irish malt,” Nallen explained.
He continued: “Our offer to our current C1 seed grower network will therefore ensure no impact on their farm profitability.”
The move comes after Boortmalt’s seed grower network outright rejected changes made to the pricing structure in their seed contracts in 2019.
Under the new pricing structure, growers will be paid a premium of €32/t over the green harvest price for feed grain.
Subsequently, Boortmalt agreed to top-up seed grower’s contracts in an effort to make up the shortfall in payments resulting from its new seed pricing model.
For Harvest 2021, Boortmalt has reached agreement with two existing third party seed assemblers, Goldcrop and Wm Connolly & Sons to ensure the continuation of C1 grade seed supply to its malting barley grower network. Members of Boortmalt’s agri-team are currently working with both seed.
Boortmalt back on track with rebuilt malting facility
Boormalt aims to buy a record quantity of malting barley this year
Boortmalt agrees to ‘top up’ seed growers' contracts