On this first day of December stock and commodity markets dropped sharply again, indicating a continuation or acceleration of the world’s economic crisis. The question is to what extent beer and malt industries will be affected, analysts communicated this month.

Looking at historical figures, beer sales figures rose from 1980 till 2007 from 931 mln to 1.787 bln hl. They dropped only once, in 1992 by 2 mln hl, but ignored all other crises during that period.

Analyst have estimated a modest beer output figure for 2009, no increase of the whisky production, and a lower malt input per hl of beer than in former times.

Total world beer output is forecast to be 1,832 mln hl in 2008 and to remain the same in 2009. China’s beer output is estimated at 417 mln hl this year and is expected to make 428 mln hl in 2009. Russia’s beer production is to amount to 125 mln hl both in 2008 and 2009.

Cobra Beer, the Indian-themed lager brand, is prepared to split its UK and Indian businesses and sell them to separate buyers as its founder, Lord Bilimoria, seeks £185 mln ($274 mln) for the group, the Financial Times reported on December, 11.

Lord Bilimoria said: “We are proactively now approaching all the major drinks companies in the world”.

The company said it will distribute this week information memorandums to trade and financial buyers stressing they can either bid for the full business, or for its UK and Indian arms separately. It will consider both cash and equity offers.

According to analysts, SABMiller could be a buyer for the whole business, given its strength in India (where it owns the Foster’s brand and is the country’s second biggest brewer) and strategy of developing international premium brands.

Diageo, which had showed interest in Cobra during the summer but later abandoned talks, declined to comment on whether it would look again at Cobra.

Cobra has brewed beer in India, which contributes about one third of total sales volumes, since 2005 from nine breweries. It has a 1 per cent share of the Indian beer market.

A potential Indian buyer could be the UB Group, which owns Kingfisher, India’s biggest beer ...More Info

Anheuser-Busch InBev NV said its investors bought 99.58 percent of the 6.4 billion euros ($8.3 billion) of new stock being sold to repay some of the takeover debt, Bloomberg reported on December, 11.

The shares were sold at the issue price of 6.45 euros each, the Leuven, Belgium-based company said. The remainder – some 2,614,025 shares - will be sold in a so-called accelerated institutional placement. Investors had been able to subscribe for eight new shares for every five they already own until Dec. 9.

InBev NV completed the purchase of Anheuser-Busch Cos. last month. The takeover incurred $54.8 billion of debt, which consists of a $9.8 billion equity bridge financing, to be repaid with the stock sale, and another $45 billion of loans.

The new shares would start trading on Dec. 16, it is reported.

Global beer giant Heineken may pay a multi-year commercial fee to United Breweries (UB) for handling distribution and bottling of its beer brands in India, the Economic Times communicated on December, 11.

Experts call this a breakthrough in the uneasy relationship between Heineken and United Breweries, which had soured following the $15.4-billion S&N buyout in January this year.

People familiar with the situation maintain that Heineken could pay around $100 million as part of discussions to clinch a business partnership with UB chairman Vijay Mallya after acquiring 37.5% stake in the Indian brewer through a global buyout of Scottish & Newcastle (S&N).

UB has insisted that its business ties with S&N were specific in nature and not extended to Heineken. As a result, despite being an equal shareholder—Mr Mallya also holds 37.5% in UB—Heineken does not enjoy any management or business rights in a company that controls nearly 48% of the India’s beer consumption.

The possibility of a payout may signal a thaw in the relationship between Heineken and UB. UB had moved the Bombay High Court to restrain Heineken from accessing any rights that were conferred to S&N, and also objected to Heineken’s group arm Asia-Pacific Breweries (APB) running parallel operations in ...More Info

To save a few yen in the unfavourable economic situation, Japan’s beer lovers are switching to cheaper third category beer, shipments of which, at 23.8 percent, have edged out those of happoshu between January and November of this year by 0.1 point, the Mainichi Daily News reported on December, 10.

According to figures released by the country’s top four breweries, regular beer shipments during November were down 12.1 percent compared to last year to 19.46 million cases.

In contrast, those of third category beer rose 12.2 percent to 9.13 million cases -- the seventh month in a row they've been higher than those of happoshu, which dropped 16.2 percent to 7.57 million cases.

The secret to third category beer's popularity is its price. The rough price of a 350-milliliter can of regular beer is, at 217 yen, well above the 160 yen for happoshu and 140 yen for third category beer. And with beer sales set to peak over the year-end period, thanks to year-end parties and sales of beer gift sets, more consumers are likely to be taking the cheaper tipple.

Total beer shipments for November dropped 8.0 percent to 36.16 million cases, the lowest figure since data was first published in 1992.

Obolon, a leading Ukrainian brewer, produced 68 mln litres of beer in November, thus increasing its total output by 3.6%, the company reported on December, 9.

In general, the production of beer in Ukraine was reduced by 4.6%.

During the eleven months of 2008, the brewer produced 10.66 mln hl of beer, up by 4.9% compared to the same period in 2007.

The increase of the national beer market in January – December this year was just 1.8%.

In November, Obolon’s share in Ukraine’s beer production grew by 3% to 37.5%. The increase is explained by production cutbacks made by the closest rivals, the company posted.

The company’s share of the nation’s beer market is 30.7% as of November 2008.

Obolon increased beer exports by 36.5% to about 80.3% in November. The company notes significant export activity of the Ukrainian beer industry – total exports grew by 27.7%.

In the eleven months of 2008, Obolon’s share of Ukraine’s total production of beer constituted 35.4%, its share of the domestic beer market was 30.4%.

In January – November, the company’s exports grew by 10.2%, which made up about 75% of the total shipments of Ukrainian beer abroad.

Obolon has proved its status as the largest beer exporter in the ...More Info

SUN InBev has decided to suspend operations at its St. Petersburg region beer plant as from December, 15 sine die, the brewer announced on December, 11.

Under existing unforeseen sag of the brewing industry and unfavourable economic forecasts, to maintain its competitiveness the company is forced to take measures for the optimisation of its production activities and cost effectiveness, SUN InBev posted on its site.

Last month, SUN InBev said it will suspend the expansion of the facility’s production capacity.

The enterprise still remains in SUN InBev’s ownership. The production capacity of the plant will be redistributed among the brewer’s remaining facilities to maintain its level of production in Russia, it is announced.

The company says it will pursue the course of implementing its long-term strategy of development in the country.

SUN InBev purchased the plant in the St. Petersburg region three years ago. The beer brand Tinkoff has been bottled exclusively there, and the company said its production will be transferred to another facilities.

Experts explain the brewer’s decision to close the plant by the fact that the North-West region of Russia has the lowest sales of the company’s beer.

Alexei Krivoshapko, Prosperity Capital Management director is surprised at SUN InBev’s decision to stop ...More Info

World’s order books for malt are filled for 2009 and partly beyond, the only danger would arise from defaults on existing contracts, analysts communicated last week.

Russia and Brazil signal attempts of defaults with severe consequences for the maltsters involved. But so far the number of contract breaches is small.

According to experts, the world’s beer and malt industry has consolidated since the last crisis and a larger percentage of the industry is in the hands of financially strong enterprises.

The split-up of the world’s malting industry looks as follows: 53% are owned by trade maltsters with a minimum capacity of 100,000 tons, 21% are brewer-maltsters, and only 26% are malting companies with smaller capacities than 100,000 tons.

In key countries like Australia, Canada, the U.S., France, Belgium, the Netherlands, the U.K. virtually 100% of the industry belong to the group of large maltsters.

Germany and the Czech Republic are known for their large number of small factories, but capacity-wise 71% of the German and 82% of the Czech production are run by strong firms.

The beer industry of the world depends on their partners in the malting line, and analysts are certain that especially the cosmopolitan brewing groups will respect their contractual obligations.

No large malting ...More Info

China’s malt overcapacity is a fact since many years, though the exact statistics of the nation’s all malt factories and of total malt production is unavailable, experts communicated at the beginning of December.

The two large national malting companies with most of their plants close to seaports, Supertime and Cofco, have been active in the export field and have expanded their sales continuously over the past years, it is reported.

According to analysts’ estimates, China’s exports of malt will reach 400,000 tons in 2008, and the figure may become larger in the future.

In China, smaller inland malt factories, often possessed by provinces, cities, but also by independent companies, produce for their neighbourhood breweries. They produce only as much malt as ordered, and most of them cannot work in summer, because they have no cooling systems, experts inform.

European Union’s feed barley market still unable to recover, the prices set by traders are logically stuck at the level of the intervention ones, La Depeche commented on December, 12.

The number of deals is very limited, with the competition between production reported by the EU nations and the Black Sea region being in the way of all attempts to increase European prices.

The majority of trading in the sphere of malting barley is restricted to the 2009/2010 crop year. The older crop is abandoned. Deals are registered regularly, but prices are again moving downwards this week.

Canada is not expected to be a major feed barley exporter this year, as domestic prices should remain more attractive to farmers, Grain News cited market sources on December, 10.

According to experts, while feed barley prices in Western Canada continue to weaken and have more room to the downside, international prices are considerably lower, which should keep Canada out of the export market going forward.

Spot feed barley bids in the key Lethbridge, Alberta market are currently sitting around C$155 per tonne, which compares with prices near C$190 per tonne a month ago, according to provincial Alberta Grain Commission data.

While domestic barley prices have dropped, Neil Slingerland, president of Newco Commodities Ltd. at Coaldale, Alta., east of Lethbridge, thought domestic barley prices would need to drop another C$30 to C$40 per tonne before they were in the export range.

"The domestic market is still substantially stronger than the export market, which means we will have a very, very small export program," said Lorelle Selinger, barley marketing manager with the Canadian Wheat Board.

Larger production in Europe and the Black Sea region will keep export prices low, she said. In addition, late rains in Australia have caused some downgrading in that country's malt barley ...More Info

The malting barley crop in Mercosur will be disappointing and will open the door for imports to Colombia and the Pacific Coast from other origins, industry experts communicated earlier this month.

Brazil started harvesting in Parana with good results, but the important crop of Rio Grande do Sul was reduced by early heat, followed by rains during harvest. The nation expects domestic malting barley deliveries of 150 - 180,000 tons and imports of 360 – 390,000 tons, normally from Argentina.

Uruguay is just self-sufficient.

In Argentina harvesting has started with rather poor results in the North, hopes are for better results in the province of Buenos Aires. Crop estimates range from 1.6 (IGC) to 2.0 mln tons, however, small grains will downgrade to feed at least 300 – 400,000 tons.

As Argentina has domestic needs of 1 mln tons, and 375,000 tons will be shipped to Brazil, it looks like a very small surplus for other destinations, experts inform.

According to the latest reports, the International Grain Council has increased its EU barley crop number to 65.9 mln tons, 8.5 mln tons more than in 2007.

Feed use will be 3 mln tons higher, and barley exports are expected to reach 4.6 mln tons vs. 3.8 mln tons last year.

Exporters have booked licences for 2.7 mln tons, as of the beginning of December.

Informa Economics forecasts that world barley acreage will be increased to 56.8 mln ha in 2009, Zerno Online reported on December, 9.

The area planted to the cereal was 54.9 mln ha in 2008.

The EU nations are forecast to grow barley on 14.0 mln ha (14.5 mln ha in 2008), Russia – 9.5 mln ha (9.7 mln ha in 2008), Ukraine – on 4.2 mln ha (4.1 mln ha in 2008).

Australia is expected to increase its barley planted area to 4.5 mln ha (from 4.2 mln ha in 2008).

Canada’s barley acreage will remain on 3.5 mln ha as in 2008, Informa Economics states.

According to industry sources, German and Scandinavian farmers will reduce their spring barley plantings in 2009, but prospects in France and the U.K. are for larger barley acres.

The real situation will clarify in spring, still high seed and fertilizer prices, the credit squeeze, and the general economic recession make forecasts even more difficult than in former years, analysts comment.

Barley imports to China totalled 1.04 mln tonnes in January – October, experts informed at the end of November.

The nation purchased 747,000 tons from Australia, 196,000 tons from Canada, 72,000 tons from France and 30,000 tons from Denmark.

Reports are that France has sold another 120 – 170,000 tons, already shipped or to be shipped, 34,000 tons were loaded last week in French ports.

The poor crop in Australia may open more opportunities for Canadian and EU barley, analysts believe.

Michigan farmers may soon introduce growing a new plant in their working schedule – hops, Record-Eagle informed on December, 8.

If the overwhelming response to a sustainable hop production workshop planned by the Michigan State University Extension is any indication, the hardy perennial and essential ingredient in beer, may be a breakout commodity.

"We have had three to four times the number of people register than what we had anticipated," said Leelanau County Extension director, Dr. Rob Sirrine, who coordinated the workshop sponsored by The North Central Region Sustainable Agriculture Research and Education Program.

"We have people coming from all over the state, from Colorado and Canada," said Sirrine, noting that even after changing venues, the Dec. 17 workshop is sold-out.

A national hop shortage is one reason for the new found interest in growing the crop that is in high demand by brewers across the country. In 1997 there were nearly 45,000 acres of hops grown in the U.S., while only 31,000 acres were devoted to the crop last year, according to the Michigan State University Extension office.

"Growers are only putting in the higher yielding varieties and big companies are buying up the supply," said Sirrine, who sees local growers being able to ...More Info

Pavel Hofta, Pavel Dostálek and David Sýkora

Abstract

ABSTRACT J. Inst. Brew. 113(1), 48–54, 2007 Excellent liquid chromatographic (LC) separation of cis/trans stereoisomers of iso-alpha-acids has been achieved with reversedphase sorbent XTerra MS C18. An isocratic alkaline mobile phase, consisting of a mixture of 5 mmol l–1 ammonium acetate (pH 8)-acetonitrile-methanol, 62:21:17 (v/v/v), was used. In the DCHA-Iso international calibration standard trans-isoposthumulone was identified combining photo diode array (PDA) spectra and electrospray high-accuracy mass spectrometric (MS) data. Moreover, the molecular mass of two degradation products resulting from the in-solution storage of the DCHA-Iso standard was determined. The presence of trans and cis isomers of isoposthumulone, isocohumulone, isoadhumulone and iso-n-humulone in beer samples was confirmed. The trans isomers of iso-alpha- acids showed characteristic and reproducibly slightly different ultraviolet absorbance spectra with respect to cis isomers. Key words: Beer, DCHA-Iso standard, electrospray, food analysis, high-accuracy mass spectrometry, isoadhumulone, isocohumulone, iso-n-humulone, isoposthumulone, UV spectra. Load full article, 7 pages, 629 Kb, PDF file