E-Malt.com newsletter - April 15

UK: Diageo announced on April 15 its intention to transfer the brewing of GUINNESS® beer for the Great Britain market to the company’s historic St James’s Gate brewery in Dublin. Regrettably, the plan would result in the closure of the Park Royal brewery in West London during the summer of 2005. Gerry O’Hagan, Supply Director for Diageo’s UK & Ireland brewing business said: “A major review of our brewing business in UK & Ireland has shown very clearly that the best option for the future would be to consolidate our production for the GB market into Ireland. Our Dublin brewery already produces the equivalent of some eight million kegs of GUINNESS® every year for distribution to international markets including Europe and the USA. With some additional investment in technology St James’s Gate could absorb the four million equivalent kegs currently produced at Park Royal. “Sadly, around 90 Diageo jobs would be lost at Park Royal. This is particularly regrettable because of the excellent track record of our employees there. Our highest priority will be to support our people at Park Royal in working through this difficult period” He continued: “We have the opportunity to get our brewing business into the best shape to support the long-term growth and development of the GUINNESS® brand. Between the two breweries in London and Dublin, we currently have more brewing capacity than we need. We know that it will take only a limited additional investment to build the already substantial capacity of St. James’s Gate to the level where it can supply the GB market with the draught GUINNESS® currently supplied from Park Royal...more info

Canada: U.S. giant Anheuser-Busch Cos. Inc.'s Budweiser is poised to become the top-selling beer in Canada, elbowing out two long-time national brewing stalwarts, according to press reports. The Globe and Mail newspaper reports that Budweiser could soon unseat Labatt Blue from the top spot. With Molson recently losing half a percentage point in market share and Labatt fighting off a growing threat from high-priced imports, craft premium brews and price discounting in the mainstream segment, several beer industry observers point to a momentum for the Budweiser brand in Canada, the largest beer market outside the US for Anheuser-Busch. “Canada's two beer giants, Molson Inc. and Labatt Brewing Co. Ltd., are scrambling to revitalize their major brands as they face erosion of their traditional dominance of the domestic market by imports and discount local brews,” The Globe and Mail said. The changes at Montreal-based Molson - including handing top executives greater responsibility for boosting brand sales across the country -- are the most recent in a series of shakeups as the brewer moves to rejuvenate such stalwart brands as Canadian and Export...more info

Portugal: Unicer - Bebidas de Portugal announced on April 13 a 10.4% rise in total revenue for 2003 up to EUR 428.5 million. The Portuguese beer and soft drinks producer saw net profit increase by 7% year-on-year, to EUR 24.9 million. Sales volumes of Unicer Group reached 683,9 million litres, against 626,9 million litres sold in 2002. Earnings before interest, tax, depreciation and amortisation (EBITDA) rose for the company last year by 4% to €91.5m. Turnover for 2003 hit €420.1m, an increase of 12% on 2002. The company credited the increase in turnover to its Spanish and Angolan markets, as well as the consolidation of its Super Bock Stout, Frutea, Vidago, Mazouco, Planura and Bogani brands. In 2003, Angola accounted for 34 million litres of Unicer’s products, while Spain took 4 million litres, four times more than it took in 2002.

Latin America: The average Peruvian now drinks just 22 litres of beer per annum. In comparison, Latin America's champion beer drinkers, Venezuela, drink an annual average of 82.5 litres, while Brazil consume 49.3, Mexico 50.7 l and Colombia 29.6 litres respectively. And per capita beer consumption in Peru is at a particularly low ebb - today's 22 litres per annum contrasts poorly with an average of 42 litres in 1987 and 35 in the mid-1990s, analysts said.

Germany: Holsten has appointed Wolfgang Burgard, 56, as a new executive board chairman. Mr. Burgard will succeed Andreas Rost in the position. Burgard was formerly chairman of Hannen Brauerei GmbH of Mönchen-Gladbach, a company belonging to the Carlsberg Group. Rost is leaving Holsten by mutual consent, the company said. The 12-man Holsten Supervisory Board, now including five new members from the Carlsberg Group, met on April 13. As well as appointing Burgard, the board also elected Nils S. Andersen, the president and CEO of Carlsberg A/S, as its chairman. Holsten executive directors Horst Bülck, 50, (finance) and Michael Trips, 44, (sales) will continue to hold their respective offices.As of the end of March, Carlsberg holds a total stake of 91.55% in the German brewer.

USA: International Malting Co. could pay a total of $280,000 a year to lease water from Giant Springs Fish Hatchery for use in its multi-million-dollar facility north of Great Falls, The Great Falls Tribune posted on April 14. The malting company would pay $125,000 a year for water, another $125,000 a year for infrastructure at the hatchery and an additional $30,000 to compensate for changes made in hatchery operations. Montana's Fish, Wildlife & Parks Commission during a meeting in Bozeman will discuss the lease agreement. Rep. George Golie, D-Great Falls, believes the agreement is unfair and is asking the commission to turn down the deal. "I'm really concerned about the rate they are getting for the water," said Golie, who also is vice-chairman of the House Fish and Game Committee. Based on the proposed lease, IMC will pay $125,000 a year for water and receive about 1.7 million gallons a day. IMC would then pay about 26 cents per 100 cubic feet of water, Golie said. The commercial rate in Great Falls is 92 cents per 100 cubic feet. The residential rate is $1.24 per 100 cubic feet for water use over 300 cubic feet. "At the very minimum IMC should pay the commercial rate," Golie said...more info

Ukraine: Ukrainian companies belonging to ZAO Ukrpivo, which holds 70% of Ukraine beer market, increased malt production in the first quarter of 2004 by 28.7% versus the same period 2002, APK-Inform posted on April 14. Ukrainian maltsters output 43.02 thousand tonnes of malt in January-March 2004, ZAO Ukrpivo reported. The largest Ukraine malting producer is Slavutsk malting plant, which increased malt output in Q1 this year by 22.7% up to 20.06 thousand tonnes. The maltster has a production capacity of 70 thousand tonnes of malt per annum. On 8 March 2004 Baltic Beverage Holding (BBH) sold 90% of company‘s shares to Soufflet Group. Berdichevsky malting plant increased 3.2 times its malt production up to 9.25 thousand tonnes. ZAT Sarmat increased its malt output by 0.8% to 1.51 thousand tonnes. Dnipro Brewery produced in the first quarter of 2004 4.18 thousand tonnes of malt, 2.6% more than in the same period last year. According to analysts Ukraine’s demand in malt is 120 thousand tonnes per year.

Chinese imports of malting barley were only 1.363 million tonnes in 2003. As stocks are very low, it is expected that imports in 2004 will increase to 1.8 million tonnes, analysts said. Domestic barley production in 2003 was 3.115 million tonnes, with a larger share of barley used for malting.

Czech Republic: About 20 malting barley varieties are grown in this new EU country. Local maltsters and brewers favour the Czech varieties Tolar, Amulet, Jersey, Kompakt, Akcent, but also the imported varieties Annabell, Scarlett and Prestige. Also the Czech acreage for spring barley is sharply down, estimate range from 430 to 380,000 ha (440,000 ha in 2003).

Theoretical malt prices.

EURO = USD 1.1978 April 16, 2004
Crop year		2003
Parity		FOB Antwerp
Position		Apr 2004-Sept 2004
Conditioning		Bulk		In bags		Bulk containers		Bags, containers
Malting barley variety		EURO	USD	EURO	USD	EURO	USD	EURO	USD
2RS	Scarlett	250.50	300.50	266.00	318.50	262.50	314.00	271.50	325.50
2RS	Prestige/Cellar	249.50	298.50	264.50	317.00	261.00	312.50	270.50	324.00
2RS	Aspen	248.50	297.50	263.50	315.50	259.50	311.00	269.50	322.50
2RS	Optic	248.50	297.50	263.50	315.50	259.50	311.00	269.50	322.50
2RS	Astoria	247.00	295.50	262.00	314.00	258.50	309.50	268.00	321.00
2RS	Cork	247.00	295.50	262.00	314.00	258.50	309.50	268.00	321.00
2RS	Average price	248.50	298.00	264.00	316.00	260.50	311.50	269.50	323.00
2RS	FAQ	245.50	294.50	261.00	312.50	257.50	308.00	267.00	319.50
6RW	Esterel	241.00	288.50	256.00	306.50	252.50	302.50	262.00	313.50
*	Asia Malt 70/30	246.50	295.00	261.50	313.00	258.00	309.00	267.50	320.50
**	Asia Malt 50/50	244.50	293.00	260.00	311.50	256.50	307.00	266.00	318.50