Base Currency: Euro, EUR on 19-November-2004 1 EUR = 1.2965 USD 1 EUR = 0.7004 GBP 1 EUR = 1.5638 CAD 1 EUR = 1.6661 AUD 1 EUR = 135.10 JPY 1 EUR = 3.6017 BRL 1 EUR = 37.028 RUB	Base Currency: US Dollar on 19-November-2004 1 USD = 0.7716 EUR 1 USD = 0.5402 GBP 1 USD = 1.2062 CAD 1 USD = 1.2851 AUD 1 USD = 104.24 JPY 1 USD = 2.778 BRL 1 USD = 28.56 RUB
EUR/USD Chart

Denmark: Danish brewing force, Carlsberg, announced on November 19 that it is building a new brewhouse in Valby, which will ensure the continued development and production of unique speciality beers aimed at beer connoisseurs. The brewery will also act as a living display window for Carlsberg's beer culture and brewing craftsmanship. Carlsberg's chief executive officer, Nils S. Andersen, today laid the foundation stone for the new brewhouse in an informal ceremony at the construction site in the heart of Carlsberg's historic building complex. Carlsberg expects to open the doors of the brew-house, which will be called "Jacobsen" – a direct reference to the firm's visionary founder J. C. Jacobsen and his son Carl Jacobsen, in June 2005. Nils S. Andersen bricks in a tube containing one of the first bottles of Semper Ardens, J.C. Jacobsen's golden words, and a description of the project. "The best thing about a brewery – large or small – is the products it produces. Carlsberg's goal is to brew beer of the highest quality. We already do this on a grand scale at the large brewery next door, and it is our ambition to do so on a small scale here. Jacobsen will form the backdrop for some of our best craftsmanship in the art of brewing at Carlsberg," said Nils S. Andersen. Carlsberg has received many positive responses, since the introduction of its speciality beer series "Semper Ardens" in 2000, and has noted an increasing interest in speciality beers. The Semper Ardens beers have been part of building the market for speciality beers. An important element has been an inspiring collaboration between the nation's leading chefs and Carlsberg's master brewers to improve the beer and the way beer complements food. Modern beer with historic roots With the new brewhouse, the company's historic roots from 1847 will be continued in a modern beer culture in which Carlsberg's speciality beers will be sold through retailers and restaurants in Denmark and abroad. The brewhouse will have a capacity of 17,000 hectolitres a year, or about five million 33 cl bottles of beer. So, there is no danger that Jacobsen will run out, when the new beers are introduced. "Danes have acquired a taste for excellent speciality beers, and we and our master brewers can only be very pleased about this. Now, we are giving our series of speciality beers a new home in Jacobsen," says marketing vice president for Carlsberg Denmark, Ken H. Andersen. At the moment, he is in the process of finding the new brewmaster who, as the inspirational heart of the brewhouse, will have overall responsibility for Jacobsen's beer. He or she must have the dedication to make an impression on the brewhouse and combine fine craftsmanship with modern brewing principles...more info

Russia: OAO Vena, the Russian brewery based in St. Petersburg, has launched the production of “Kronenbourg 1664”, a famous French beer brand, one of the best sold in European market, Russian Beer Union revealed in a statement on November 19. Vena brewery said it had invested US$220,000 in equipment to produce Kronenbourg 1664, which is going to become the most expensive beer in the premium licence segment of the market, having a retail price of RUB 28-31 per bottle. The French beer is sold in more than 70 countries of the world. Vena planned to produce 40,000 hl of Kronenbourg beer by 2005. OAO Vena was created on July 20 1992 and is controlled 49.9% by Swedish Baltic Beverages Holding (BBH), and 49.9% by Danish brewing giant Carlsberg. The decision to produce under licence Kronenbourg 1664 at Vena brewery under control of Kronenbourg Breweries, owned by Scottish&Newcastle, was taken in winter 2004. The strong reason was the rapid growth of licence beer market in Russia: in 2003 this segment increased by 102%, versus previous year. According to Business Analitika the volume of licence beer market in Russia increased 73% in the first 8 months of 2004, which exceeds five times the growth of the whole beer market (the average index-13%). This segment is a high competitive one. Nowadays 40 beer brands are produced in Russia under licence. OAO Vena is brewing Nevskoye beer and is bottling Tuborg beer under licence. The brewery is also producing low-alcohol beverages. In 2003 Vena increased its sales volumes by 24.7% versus 2002 up to 163 million litres. The company’s net profit accounted for RUB 174.5 million in 2003. Now OAO Vena is in the process of merging with OAO Zolotoy Ural, based in Chelyabinsk.

Canada: Labatt Breweries, the Canadian unit of Belgium's InBev, announced on November 18 it is had ratified a closure agreement with Local 300 of the Brewery, Winery and Distillery Worker's Union. In September Labatt announced the closure of the Pacific Coast brewery in New Westminster, British Columbia, because of excess capacity. Labatt Breweries's unionized workers have approved an agreement, Labatt revealed. The employees ratified the closure agreement by vote on November 17. The anticipated brewery closure date is April 21, 2005 with production switched to facilities in Creston, British Columbia, and Edmonton, Alberta. The agreement calls for Labatt to pay the laid off workers C$5.5 million ($4.6 million) in addition to the C$1 million in support it announced in September. "Labatt would like to thank the executive of Local 300 for their efforts in negotiating this closure agreement," said Neil Sweeney, Labatt Breweries of Canada Director of Public Affairs, Western Canada. "They negotiated professionally on behalf of their members and we are pleased that they will receive additional separation monies." "The negotiating team of Labatt was very professional during this difficult time," said Tom Smith, Labatt New Westminster Local 300 President. "We appreciate their honesty and desire to provide our members with an improved severance and separation package." Labatt Breweries of Canada is one of the nation's longest-established and most successful brewing companies. A proud brewer of quality beers, Labatt operates breweries from coast to coast and distributes in 40 countries. Labatt is part of Belgian-based InBev, the world's premier brewer.

United Kingdom, London: The world's third-largest brewer, SABMiller Plc, beat forecasts with a 28 % rise in half-year profits on the back of a turnaround at U.S. arm Miller and said it had plenty of firepower for any future big deals. The brewer of Miller Lite, Castle and Nastro reported the first rise in Miller's U.S. market share in years as its turnaround strategy reached mid-point, while a strong rand boosted already buoyant South African profits, Reuters revealed on November 18. The London-based company said on Thursday, November 18, it will look at any big deals brewing in the sector that may emerge in the future and that it had the ability to raise up to $2.5 billion in debt before needing to resort to potential equity issues. Chief Executive Graham Mackay said the company was set to see further underlying beer volume growth in its second half after a 5 percent rise in the first half with a strong performance from most areas across the world, except for Italy. "For the second half, although we see higher energy, commodity and marketing costs, we are still well placed to see further organic beer volumes increases," Mackay said. The brewer, ranked third in the world after Belgium's InBev and Anheuser-Busch, posted earnings before interest, tax and amortisation (EBITA) for the six months to Sept. 30 of $1.141 billion, well ahead of analyst forecasts of $1.013 billion to $1.081 billion. "These were strong results across the board and the run up in the shares which has been largely on the back of a strong rand will now be based on the fundamental strengths of the business," said analyst Michael Bleakley at CSFB. SABMiller shares ended up 2.7 percent at 870 pence after hitting a new record high of 889-1/2p. It has outperformed the index by 36 percent and rival Scottish and Newcastle by 30 % this year. The shares have risen nearly 50 percent from 570p at the start of 2004 on the back of the rand, which has appreciated by nearly 40 percent against the dollar since the Miller deal, and strong performances by most of its businesses around the world. SABMiller broker Cazenove upgraded its forecasts and said at a share price of 880p SABMiller's price earnings multiple for 2004/2005 at 15.6 times is five per above other European brewers but still nine percent below its closest peer InBev. The broker pushed its earnings forecast up by 4 percent to 94 cents from 90.3 for 2004/2005, and to 103.1 cents from 99.6 for the following year...more info

Chile, Santiago: CCU, the Chilean brewer Compania Cervecerias Unidas SA issued US$110 million in five-year bonds last week, before Anheuser-Busch sold its minority stake in the brewer, local media revealed. CCU is a diversified beverage company operating principally in Chile and Argentina. CCU is the largest Chilean brewer, the second-largest Argentine brewer, the third-largest Chilean soft drink producer, the second-largest Chilean wine producer, the largest Chilean mineral water producer and recently entered the pisco business. The Company has licensing and/or joint venture arrangements with Paulaner Brauerei AG, Anheuser-Busch Incorporated, Heineken Brouwerijen B.V., PepsiCo Inc., Schweppes Holdings Limited, Guinness Brewing Worldwide Limited and Watt’s Alimentos S.A. On November 3 CCU posted its revenues up 7.8% for the first nine months of the year. Operating Income Increased 46.8%, EBITDA(1) Up 17.6%, Net Income Decreased 40.4% to US$0.56 per ADR. In the third quarter the beer Argentina segment increased its revenues 13.1% and improved its operating results by US$0.8 million, due to higher sales volume and price recovery in US dollar terms, rising from US$29/HL in Q3’03 to US$33/HL in Q3’04. Consolidated volumes growth is explained by an increase of 12.3% in beer Argentina, 4.0% in the soft drinks segment, 2.9% in beer Chile and 5.7% in the Chilean bottled export wine business. The increase in average prices is explained by increases of 2.1% in beer Chile, 16.5% in Chilean domestic wine, 2.4% in nectars and 1.1% in beer Argentina.

Hong Kong: China Resources Enterprise, Limited, a state-backed conglomerate that makes beer and operates supermarkets, announced on November 18 its third-quarter ended 30 September, 2004 earnings fell. The Group’s unaudited consolidated turnover for the third quarter and nine months ended 30 September, 2004 amounted to HK$12,389.0 million and HK$35,029.7 million respectively, both representing an increase of 39.9% over the same period of last year. The Group’s unaudited consolidated net profit attributable to shareholders for the third quarter of 2004 fell 9.4% to HK$337.0 million whereas that for the nine months ended 30 September, 2004 rose 1.5% to HK$1,139.0 million. The beer operation saw its profit bubble 13 percent to HK$78.4 million. The retail business continued its growth momentum with earnings reaching HK$82.1 million in the first three quarters, as compared with a net loss of HK$111.5 million for the same period of 2003. In particular, the supermarket division demonstrated sustainable improvement with net earnings of HK$5.3 million and HK$45.6 million respectively for the third quarter and nine months ended 30 September, 2004, as compared to respective net loss of HK$20.7 million and HK$86.8 million for the corresponding period in 2003. Strong profit recovery was driven by effective pricing strategy, optimized composition of merchandises, growing contribution from Suguo as well as substantial increase in suppliers’ rebate. The beverage business recorded earnings growth of 12.7% and 42.8% for the third quarter and nine months ended 30 September, 2004 over the corresponding period of last year. Strong organic growth, helped by the increase in average selling price and aggressive promotion as well as satisfactory contribution from newly acquired breweries were attributable to the substantial growth in earnings. In the first three quarters of the year, the operation recorded a 21.3% sales volume growth of beer to approximately 2.6 million kilolitres. Sales volume of “Snow’’ rose 35% to approximately 727,000 kilolitres over the same period of last year. To create an integrated identification of the national brand “Snow” with the company name, the Group has renamed its beer investment holding company, China Resources Breweries Ltd., as China Resources Snow Breweries Ltd. China Resources Breweries, a joint venture with global giant SABMiller , is the second-largest brewer in China after Tsingtao Brewery . China Resources shares, a member of Hong Kong's blue-chip Hang Seng Index have gained 38 % in the past year, outperforming the 15 % rise in the index, according to Reuters.

Malt News

Russia: From November 15 onwards export of German barley and malt to Russia was brought to a halt, due to an overall ban posed by Russian Federation authorities on German agricultural production of plant origin. The Russian competent authority (“Rosselhoznadzor”) in an official statement provided as an explanation of the ban, “noncompliance from the part of the German State Plant Protection Service with the Russian Phytosanitary Inspection import requirements”. Diana Magat, the spokesperson of Agricultural Ministry of Russian Federation confirmed that indeed import of German malt is now impossible. Mrs Heimann, export operation director of Wessheimer Company, one of the largest German malt producers, commenting on the ban, mentioned that the maltster is to continue malt shipments to Russia from its plants in Poland and Hungary. The Logistics Director of Tinkoff Brewery, Mr. Igor Belov, said the company will respond to the ban switching to malt supplies from France and Finland. Tinkoff Brewery one of the most active Russian importers of German malt. It is not clear how long these restrictions will apply. Mrs. Magat, commenting on this issue, stated that the subject will be a matter of negotiations between the Russian Ministry of Agriculture and the German Embassy in Russia. “At this moment there are no reasons whatsoever of lifting the restrictions,” said Mrs. Magat. German malt imports cover 10% of Russian malt annual needs. (Source: The Union of Russian Brewers)

France: The leading producer of French malt, Malteries Franco-Belges, has recently published a consolidated turnover of 22,47 Million Euros for the first quarter of its 2004/05 financial year. According to pro forma data, the turnover registered a decrease of 7,2% compared to the same period of the last financial year.

Barley News

Australia: ABB Grain Ltd announced on November 17 that Eastern Australian grain handler, Australian Bulk Alliance, will be in a better position than ever to meet client and grower service needs, following the decision by major Japanese trading house, Sumitomo, to acquire GrainCorp’s 50% stake in the business. ABA general manager, Geoff Barker, said with the backing of Sumitomo, which already had extensive interests in Australia, and of the ABB Grain group, which owns the other 50% of ABA, the company was ready to provide a better alternative in grain handling and supply chain services for the eastern states grain market. ABA currently has grain receival sites at Goolgowi, Coolamon, The Rock, Tocumwal, Woorinen, Nullawill and Tatyoon as well as the export terminal in Melbourne. But Geoff Barker believes there is still plenty of room for the company to move. “We believe with such strong backing we will be able to grow the business at our existing sites and explore further opportunities,” he said. “Over the past couple of years we have been able to successfully grow the business despite several adverse seasons, and most recently the uncertainty caused by the merger of Grainco and GrainCorp, and the latter’s consequent undertaking to the Australian Competition and Consumer Commission that it would divest itself of its share in the business. “ABB Grain and Sumitomo already have a long-standing trading relationship through Joe White Maltings, which became part of the company in the recent merger with AusBulk so we are confident that with their successful historical association they will provide a solid foundation for the future growth of the business,” Mr Barker said.

Theoretical malt prices.


* - 70/30 = 70% Average two Rows Spring and 30% Six Rows Winter
** - 50/50 = 50% Average two Rows Spring and 50% Six Rows Winter

Theoretical malt prices for crop 2005 are available on site www.e-malt.com/MarketPrices

Malting barley prices. French barley prices.

Nominal prices.

EURO = USD 1.2965 November 19, 2004
Crop year		2004		2005
Parity		FOB Creil		FOB Creil
Position		July 2004		July 2005
Type	Variety	EURO	USD	EURO	USD
2RS	Scarlett	111.00	144.00	121.00	157.00
2RS	Prestige	109.00	141.50	120.00	155.50
2RS	Cellar	109.50	142.00	120.50	156.50
2RS	Aspen	108.50	141.00	119.50	155.00
2RS	Optic	108.50	141.00	119.50	155.00
2RS	Astoria	108.00	140.50	119.00	154.50
2RS	Cork	108.00	140.50	119.00	154.50
6RW	Esterel	100.00	130.00	105.00	136.50

nq - Not quoted Prices for Danish and UK malting barley are available on site www.e-malt.com/MarketPrices

Table of the week

World Barley Malt Trade, in thousand tonnes, grain equivalent WORLD MALT TRADE   2002/2003  2003/2004  2004/2005f  MALT EXPORTS  Argentina  337  275  300   Australia  691  712  720   Canada  617  626  620   EU 25 3,366  3,422  3,200   USA  94  144  140   Uruguay  242  252  275   Other  274  149  165   WORLD TOTAL  5,621  5,580  5,420   MALT IMPORTS  EUROPE  531  278  235   CIS BALTICS  1,004  869  750   Russia  800  755  625   N&C AMERCIA  597  617  635  Mexico  171  219  230  USA  230  218  220   South AMERICA  1,222  1,374  1,325  Brazil  875  810  850  Venezuela  241  495  375   N E ASIA  20  22  20   F E ASIA  1,705  1,853  1,870  Japan  701  680  660  South Korea  143  158  160  Philippines  230  244  260  Thailand  225  275  300  Vietnam  201  229  230   AFRICA  501  533  545  South Africa  65  92  75  Other/unsp  281  278  290   WORLD TOTAL  5,621  5,580  5,420  Source: IGC

Graph of the week

Agenda

November 2004:
World Brewing Academy Applied Brewing Techniques. Munich, Germany;
World Brewing Academy Concise Course in Brewing Technology. Chicago, Illinois, United States;
INTERNATIONAL EXH FOR FOOD & DRINK INDUSTRY / WORLD FOOD UKRAINE 2004;
INT'L EXH OF WINES, ALCOHOLIC & NON ALCOHOLIC DRINKS & PROTECTION EQUIPMENT / EXPO DRINK 2004. Romania;
TALLINN FOODFEST 2004;
Belgian Beer Fest, Boston MA;
Teach a Friend to Brew Day;
FOOD PROCESSING MACHINERY EXPO 2004;
FISPAL RECIFE 2004 / INTERNATIONAL FOOD FAIR. Brazil.;
BRAU Beviale 2004. Nürnberg, Germany.;
Brewers' Association of America Conference;
Fall Fest-Of-Ale. Janesville, Wisconsin, United States;
Accrington Beer Festival. UK;
FOODAPEST 2004. 7th International Food, Drink and Food Processing Trade Fair;
INTERNATIONAL EXH FOR FOOD INGREDIENTS, ADDITIVES & FLAVOURINGS / INGREDIENTS RUSSIA 2004;
BELPRODUKT International Exhibition for Food and Beverages. Minsk, Belarus ;

December 2004:
FOODEX Food, Beverages and Food Technologies Fair. Ankara, Turkey;
Eten & Genieten Food, Beverages and Kitchen Supplies Exhibition. Amsterdam, Netherlands;
Americas Food & beverage Show and Conference;
Holiday Ale Festival;
Sint Niklaas Visits Brewery Ommegang;
IWEX 2004;
WORLD OF FOOD INDIA 2004;
KerstBierFestival 10th edition! Belgium;
VIETFOOD & DRINK 2004 / 3RD INTERNATIONAL EXH ON FOOD AND DRINK;

January 2005:
Big Beers, Belgians & Barleywines Festival. Vail CO;
35th Barley Improvement Conference. The American Malting Barley Association;
VIETFOOD (HANOI) 2005;
Atlanta Cask Ale Tasting;

More events are available on site e-malt.com