Philippine billionaire Lucio Tan plans to list Asia Brewery Inc., the country's second largest beer producer, to raise funds for expansion and is looking at a possible IPO next year, Reuters reported April 19.

Tan, the Philippines' third-richest man with a net worth of $2.3 billion according to Forbes magazine, declined to tell reporters on Thursday how much would be raised in a listing.

Asia Brewery has about 10 percent of the local beer market, a source from the Tan group of companies told Reuters. Its biggest rival is Southeast Asia's largest food and drinks group, San Miguel Corp. , which dominates Philippine beer sales.

Tan, who made his fortune on cigarettes and beer in the 1970s and 1980s during the dictatorship of Ferdinand Marcos, set up Asia Brewery in 1982.

The firm has two breweries in the Philippines, with a combined annual capacity of 6 million hectolitres of beer, and several units in China.

Other firms that are majority-owned by Tan include Philippine National Bank , Allied Banking Corp. , holding firm MacroAsia Corp. , Philippine Airlines and the unlisted Fortune Tobacco.

There was no spectacular malt purchase action reported during March, and the large groups Inbev, Heineken, Carlsberg and SAB stayed on the sidelines. But regular business went on, altogether for good quantities, domestically and for export.

Malt prices remained stable, local prices for delivery 2008 in the range of EUR 375,- to 380,-, CPT breweries, and EUR 385,- to 390,- FOB seaport, in bulk in container for destinations abroad.

Besides there was still a fair amount of business in old crop malt for delivery in 2007 at prices in the 450,-/470,- range, depending on parity. Maltsters seem unwilling to step away from their safety policies, whereby they sell malt only against a corresponding barley cover. Malting margins range from EUR 100,- to 120,- per ton, mostly at the higher end of the range.

EU maltsters booked export licences for 1.333 million tonnes from July 2006 until end March 2007, 260,000 tonnes less than a year ago. Last year the pace of exports picked up during the last quarter of the campaign.

This year it looks as if total exports for 2006/07 will fall short of last year’s number by 350 – 400,000 tonnes. Due to larger local demand, factory closures and smaller production, EU malt is virtually sold out for the whole of 2007, and the lower export figures do not create any market pressure at all.

Not only malting barley, but also feed barley supplies of crop 2006 are very tight in the EU. Export shipments of feed barley have moved back to the Black Sea, since the Ukrainian government has abandoned its quota system.

So far the EU Commission has issued 3.013 million tonnes of barley export licences, 400,000 tonnes more than a year ago. The Commission granted also close to 40,000 tonnes of import licences against the quota of 306,000 tonnes at a preferential import duty of EUR 16,- per ton. A good part of those licences will have been used for imports of malting barley, from South America and Eastern Europe.

Markets have reacted in a small way to the favourable planting season. Old crop barley is appearing in the market in bits and pieces, the total offer is minimal.
French 2rs barley, basis July 2006, FOB Creil, is offered at EUR 215,-/218,-,
Danish 2rs barley, April, FOB seaport is EUR 228,-/230,-,
UK 2rs, same parity, EUR 225,-.

New crop barley traded:
French 2rs Sebastian, July 2007, FOB Creil 179,-,
Danish 2rs, October, Fob seaport EUR 179,-.

As maltsters do not leave their sales uncovered, they also purchase crop 2008 barley for the remainder of the calendar year, i.e. beginning of the new crop year.
French 2rs, basis July 2008, FOB Creil, traded at EUR 170,-/171,-,
Danish 2rs barley, October 2008, FOB seaport, at EUR 175,-.