E-Malt.com Flash 07a. February 14

Belgium: Belgian brewing giant InBev announced on February 14 it is launching a mandatory tender offer for the shares of Brazil's AmBev that it does not already own. On 9 February, 2005, InBev SA/NV, a corporation incorporated under the laws of the Kingdom of Belgium, with its headquarters at Brouwerijplein 1, 3000 Leuven (“InBev”), obtained from the Brazilian Securities and Exchange Commission (Comissão de Valores Mobiliários, “CVM”) the registration of the terms and conditions of the mandatory tender offer (“the MTO”) that, pursuant to Brazilian law and further to the closing of the combination with AmBev in August 2004, InBev must launch for the common shares of Companhia de Bebidas das Américas – (“AmBev”) that it does not hold directly or indirectly - a total of 3,643,945,408 AmBev shares. The MTO includes both a stock-for-stock option and a cash option. The stock-for-stock option will not be available in connection with 60,730,600 AmBev common shares held by a wholly-owned subsidiary of AmBev. AmBev shareholders that elect the stock-for-stock option will receive 13.827166 newly issued and/or already existing ordinary shares of InBev for each lot of 1,000 AmBev common shares tendered. The InBev shares will be entitled to the dividend relating to the 2005 financial year and subsequent financial years and will trade solely on Euronext Brussels. Fractions of InBev shares will be delivered in cash (in Brazilian Reais (R$)), on the basis of EUR 25.55 per InBev ordinary share. AmBev Shareholders that elect the cash option will receive an amount in Brazilian Reais (R$) equivalent to EUR 353.28 for each lot of 1,000 AmBev common shares tendered. The MTO will start on 14 February 2005 and will end on 29 March 2005. The cash option of the MTO will be settled 5 days after the end of the MTO. The stock-for-stock option of the MTO will be settled within 90 days after the end of the MTO, due to the need to comply with Brazilian foreign investment formalities and the time required for the effective issuance and/or purchase of the InBev shares to be delivered to tendering AmBev shareholders. An Extraordinary Shareholders’ Meeting of InBev will be convened on 17 March 2005, in accordance with Belgian law formalities, in order to, among other things, approve the principle issuance of up to 49,545,705 new InBev ordinary shares that the Board of Directors of InBev will be authorized to use solely to the extent needed for the purposes of satisfying the stock-for-stock option of the MTO. InBev is a publicly traded company (Euronext: INB) based in Leuven, Belgium. The company's origins date back to 1366, and today it is the leading global brewer by volume. InBev’s strategy is to strengthen its local platforms by building significant positions in the world's major beer markets through organic growth, world-class efficiency, targeted acquisitions, and by putting consumers first. InBev has a portfolio of more than 200 brands, including Stella Artois®, Brahma®, Beck’s®, Leffe®, Hoegaarden®, Staropramen® and Bass®. InBev employs some 77,000 people, running operations in over 30 countries across the Americas, Europe and Asia Pacific. In 2003, InBev realized a net turnover of approximately 9.3 billion euro (2003 pro forma).

Russia: Strong Russian beer sales helped East European brewer Baltic Beverages Holding AB (BBH) to a 23.1 % surge in fourth quarter volumes, and it forecast further strong growth, BBH posted on Tuesday, February 15....more info

Japan: Asahi Breweries Ltd., Japan's largest beer maker, forecast a better-than-expected 50 % jump in 2005 profit on Tuesday, February 15 after hitting a record in the previous year, betting its new beer-like drink will help earnings at Japan's top brewery. Asahi Breweries, known for its flagship "Super Dry" beer, posted a 31.8 % increase in net profit in 2004 to 30.6 billion yen ($291.4 million) thanks to cost cuts and favorable summer weather that spurred consumption of beer and soft drinks. Its 2004 sales came to 1.44 trillion yen, up 3.1 percent from a year earlier. Its sales volume of beer and its low-malt "happoshu" beverage was flat in the year ended Dec. 31. The company said it expected a group net profit of 46 billion yen for the current year to December on sales of 1.53 trillion yen. Eight analysts polled by Reuters Estimates produced a consensus 2004 profit forecast of 25.20 billion yen, and a projection of 41.60 billion yen for 2005. "Our sales grew little as you can see, but we were able to produce a solid profit rise because we have improved our earnings structure through cost cuts," said the company's senior managing director, Yoshihiro Goto. Despite the profit increase in 2004, the brewer was hit by rival Sapporo Holdings Ltd.'s low-priced beer-flavoured "Draft One," which made its debut in February 2004. The product, along with unlisted Suntory Ltd.'s "Super Blue," which combines happoshu and shochu, a distilled alcohol made from raw materials like sweet potatoes, has been slurping away at the beer market due to its low price. In a bid to regain market share, Asahi in April will introduce its new "Shinnama" product, which uses soybean peptides instead of malt and will be in the low-tax "other" category. Asahi estimates the overall "third-type" beer market, in which second-ranked Kirin Brewery Co. is to debut another product in April, will increase by 84 % in 2005. With the new drink, Asahi expects its sales of beer-related products -- beer, happoshu, and beverages in the new category -- will increase by 2.9 percent in 2005. Kirin and third-ranked Sapporo will announce their 2004 earnings results on Friday. Besides the new beer-like beverages, alternative alcohol drinks such as shochu and cocktails are seen gaining in popularity and Asahi expects its alternative alcohol sales to jump 33.3 percent in 2005. Alternative alcohol includes wine and whisky...more info

USA: Beer-related businesses, including brewers, wholesalers, retailers, and brewer suppliers, contribute more than $162 billion annually to the U.S. economy, according to a detailed study released on February 16....more info

Austria: Austria’s beer makers brewed about 8.88 million hectolitres of beer in 2004, a 2.5% decrease compared to 2003. According to the statement of the chairman of the Austrian brewery association, Johann Sulzberger, from February 15, beer exports for 2004 were down by 17% year-on-year, to 458,000 hectolitres. Sulzberger forecast beer output is to remain unchanged or to rise slightly in 2005. Austria’s per capita consumption fell to 108.2 litres during 2004, compared to 110.6 litres in 2003. Domestic consumption also decreased, by 2.5% to 8.42 million hectolitres, Sulzberger said. The figures for beer imports are not yet available, however it is expected that they will register an increase of between 3% and 5% for the year, from 550,000 hectolitres in 2003.

World Beer Production: Analysts Plato estimate the world beer production at 1.471 billion hl in 2003, a plus of 19,6 % from 1995....more info

Malt News

EU: International Grains Council (IGC) forecast European Union, the world’s largest malt exporter, to ship 3.2 million tonnes of malt in 2004/05....more info

Barley News

Australia: Malting barley prices in Australia underwent significant gains after December rains damaged an already drought-stressed crop....more info

USDA Barley Estimate 2004/2005: World barley production increased 7.1% to 152.5 million metric tonnes....more info

Ukraine: APK-Inform analysts increased the forecast of barley export in the 2004/05 MY by 200,000 tonnes - up to 4.2 million tonnes due to active shipments of barley from Ukraine. According to State Statistics Committee, in December 2004 Ukraine exported 544,000 tonnes of barley (21 % up from November). In January, according to APK-Inform estimates, the traders exported some 500,000 tonnes of barley more, and another 200,000 tonnes have been shipped over the first two weeks of February. Thus, the export of barley since the start of season until the moment has constituted some 3.87 million tonnes.

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

Malt Price Evolution

Malt Market Price Evolution, Crop 2005

Source: E-malt.com

Malting barley prices. French barley prices.

Nominal prices.

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

Table of the week

Canada: Barley Supply and Disposition

	2003-2004	2004-2005 f	2005-2006 f
Harvested area, '000 ha	4,446	4,050	4,040
Yield, tonne/ha	2.77	3.26	3.01
Production, '000 metric tonnes	12,328	13,186	12,180
Imports, '000 metric tonnes	36	50	30
Total Supply, '000 metric tonnes	13,838	15,344	15,910
Exports, '000 metric tonnes	2,445	1,850	2,500
Food & Industry Use, '000 metric tonnes	298	300	380
Feed, Waste, Dockage, '000 metric tonnes	8,574	9,089	9,525
Total Domestic Use, '000 metric tonnes	9,286	9,794	10,310
Carry-out Stocks, '000 metric tonnes	2,108	3,700	3,100
Average Price, CA$/tonne	138.80	100-120	110-130

Graph of the week

Agenda

February 2005:
Pianeta Birra - Beverage & Co. International Show of Beers, Beverages etc., Italy;
Seminaire Orges brassicoles 2005 à Paris-Bagnolet;
Liqma International Beverage Industry Exhibition, Spain;
Canadian Food and Beverage Show;
GrainWorld 2005. Canada. CWB.;
Beer Business Daily's Second Annual Beer Industry Summit.;

March 2005:
Night of Great thirst, Belgium;
Zythos Beer Festival, Belgium;
Institute and Guild of Brewing Africa Section 10th Convention, South Africa;
China Drinktec China International Exhibition on Beverage, Brewery and Wine Technology;
FOODEX JAPAN 2005 / INTERNATIONAL FOOD & BEVERAGE EXH;
International Food and Drink (IFE), UK;
BLACK SEA GRAIN: A NEW ENVIRONMENT IN UKRAINE AND REGIONAL PROSPECTS FOR GROWTH;
Deltabierfestival, The Netherlands;
Spring Beer Festival "Hops on Equinox", Seattle;
Brew and Beverage Industry - Beer Auction International Trade Fair, Russia;
Siebel Institute Brewing Profitability Workshop;

April 2005:
Helsinki Beer Festival;
Concise Course in Brewing Technology;
World Barley, Malt & Beer Conference 2005;
JOINT LEGISLATIVE CONFERENCE. Washington, D.C., USA;
BEER. Exhibition Pavilion Minsk.;
Craft Brewers Conference & BrewExpo America;
Classic City Brewfest, Athens, GA;
WINES, BEERS AND DRINKS Exhibition for the Beverage Industry. Krasnoyarsk, Russia;
Excursion to West-Flanders;

More events are available on site e-malt.com