USA: Covid-19 pandemic disrupts both brewing industry and outlook for barley growers

Where do you like to grab a cold beer? Big games, concerts, bars and restaurants are popular places to tip back a bottle or a draft. But since March, venues where people typically drink beer have been either closed or have seen major changes to prevent the spread of coronavirus. That’s pushed many beer drinkers back home, sending off-sale beer sales soaring.

Those changes have disrupted the brewing industry and the outlook for barley growers, AG Week reported on July 4.

“Essentially, all the on-premises business went to zero,” says Doug Restemayer, president of D-S Beverages in Moorhead, Minn. “So all of our draft business pretty much dried up literally overnight.”

Craft beer sales across the country dropped as much as 80% since the pandemic started. But Restemayer says canned beer sales skyrocketed, especially larger packages of lower-priced beers. That’s good news for malting barley growers, although questions remain about the future.
“We’re in territory that we just are not exactly sure where we’re going here. Things are changing daily and we’re just not sure where we’re going,” says barley farmer Greg Kessel.

Kessel farms in Belfield, N.D., and also is the chair of the North Dakota Barley Council. He says all of North Dakota’s 640,000 contracted barley acres were planted, representing a 10% increase from 2019. But some growers in Montana and Wyoming canceled contracts and didn’t plant this season.

“Short-term, no, I don’t see any shortages. My concern would be maybe a year down the road because this stuff didn’t get planted,” Kessel says.

Barley not used for the malting industry is used for pet food and livestock feed.

While at least one malting plant halted production during the pandemic, the Anheuser-Busch plant in Moorhead did not. Nikki Zahradka-Bylin, Anheuser-Busch’s Midwest regional agronomy manager, says so far they haven’t seen a lot of effects on their barley contracting.

“We still need barley for Moorhead in our malt plant, so we are still continuing to hold to our contracts and our delivery schedule,” she says.

“No barley, no beer. And I know everyone likes their beer,” Kessel says.

05 July, 2020