USA: Growers and maltsters adjusting to shift in demand for two-row barley varieties

Last year, microbreweries accounted for more than 23 percent of the $111.4 billion U.S. beer market and craft beer volume sales increased 5 percent, continuing a trend of rapid growth in recent years, while overall beer volume sales were down 1.2 percent.

That's a significant switch for barley growers and malters in North Dakota and Minnesota, both major states in barley production, where six-row barley has been grown for more than a century and still predominates, although two-row varieties are gaining in both states, the AG Week reported on May 26.

The shift has come as major commercial brewers, responding to consumer preferences involving the qualities and varieties of craft beers, have followed suit. The transition to two-row barleys was given a big boost six or seven years ago, when Anheuser-Busch InBev announced it would focus on developing two-row varieties, said Marv Zutz, executive director of the Minnesota Barley Growers, based in Red Lake Falls.

Cargill, in fact, recently cited the continuing switch to six-row barley and the western migration of barley production as reasons for shutting down its malting plant in Spiritwood, N.D., which employs 55 workers.

But barley growers, who are facing flat-to-declining demand for beer overall, are not quick to complain about the pressures to grow different varieties of barley than those they were long accustomed to planting.

"The craft brewers have been a lifesaver for the barley growers of the U.S.," Zutz said. Besides the change in consumer tastes toward craft brews, beers made by microbreweries usually are heavier, using three times as many bushels of barley for a barrel of beer, he said.

"That has maintained the barley acres in the U.S.," Zutz said, noting craft beer demand has soared over the past decade or more. As a result, "We've come to a stabilized market."

Rahr Malting Co., based in Shakopee, Minn., is a major behind-the-scenes player in the malting industry. It operates one of North America's largest malting plants in Shakopee and gets much of its barley from growers in North Dakota and Minnesota.

To capitalize on the increasing popularity of craft beer, Rahr formed a subsidiary in 2004 called Brewers Supply Group, or BSG, which sells malt, hops and filtration products for microbreweries and home brewers.

"The demand for those two-row barley varieties has increased significantly," said Jake Keeler, BSG's marketing director. Although demand for two-row varieties continues to grow, Keeler believes the six-row malts preferred by large commercial brewers will ensure demand for those varieties remain strong as well.

"They're massive," he said, referring to the major brewers whose beers line the shelves of liquor stores. "They still have a place in the beer market. I don't think that's ever going to change."

Still, creating BSG to cater to craft and home brewers was a move by Rahr to adapt to changes in the market, Keeler said. "We can act a little more like a small maltster."

Consumers' constant thirst for variety is not going away, Keeler added.

"I think people are looking for new experiences," he said. "They're looking for change."

Craft brewers keep experimenting to cater to consumers' changing tastes, Mark Bjornstad, Drekker Brewing Co's co-founder, said. Besides his "base malt," he always carries a variety of specialty malts to brew beer with special flavors. Bjornstad, whose brewing evolution began as a beer aficionado, then graduated to home brewing before entering the business, is drawn to the constant evolution of beer varieties and flavors.

"We're continuously sampling new malts and new varieties, all types of different flavors," he said. "That's what consumers are asking for."

28 May, 2018