Base Currency: Euro, EUR on 09-November-2004 1 EUR = 1.2921 USD 1 EUR = 0.6963 GBP 1 EUR = 1.5430 CAD 1 EUR = 1.7066 AUD 1 EUR = 136.39 JPY 1 EUR = 3.6657 BRL 1 EUR = 37.0445 RUB	Base Currency: US Dollar on 09-November-2004 1 USD = 0.7743 EUR 1 USD = 0.5389 GBP 1 USD = 1.1942 CAD 1 USD = 1.3208 AUD 1 USD = 105.56 JPY 1 USD = 2.837 BRL 1 USD = 28.67 RUB
EUR/USD Chart

China: InBev, the world's largest brewer by volume, announced today, November 8 that it is acquiring the remaining 45% interest in Hunan Debier Brewery Company Co. Ltd., located in Hunan province, China, for a cash consideration of USD 18.2 million. This transaction is part of InBev’s ongoing integration process of the Lion Group Breweries, which it acquired earlier this year. The transaction is expected to close by year end 2004. InBev currently has two breweries in the Eastern Chinese province of Hunan (66.6 m inhabitants), the Hunan Debier Brewery in the city of Changsha and Zhuzhou Debier Brewery Co. Ltd in the city of Zhuzhou. Both breweries were acquired as part of the transaction with the Malaysian Lion Group, which sold its China brewery operations to InBev at the beginning of this year. As part of that transaction, InBev acquired 55% of the Hunan Debier Brewery. Today InBev announces the acquisition of the remaining 45% from Changsha Baisha Brewery Limited Liability Company. InBev is one of the leading brewers in the Hunan province and it has a market share of over 80% in the city of Changsha. Hunan Debier brewery has a capacity of 1.3 m hl and 1.1 m hl of production volume, producing mainly the local Baisha brand. The brewery is profitable with an expected sales volume growth in 2004 of 32% versus 2003. This transaction was completed at an EV/EBITDA multiple of 7.7x and at an EV/hl multiple of Euro29. Management expects this acquisition to be EPS accretive to InBev, from 2005 before goodwill amortization. “With this acquisition, Interbrew China has reinforced its position in Hunan, further illustrating its commitment to the province,” says Patrice Thys, President InBev Asia Pacific Zone. “We are very pleased with the support we have received from the local government.” “We are delighted to see Interbrew’s strong commitment in the Hunan market through this transaction,” says Mayor Tan of Changsha Government. “Interbrew shall receive full support from the Changsha Government for its investments in Changsha going forward.” InBev is the third largest brewer in China, with a production capacity of 30 m hectoliters, a market share of over 10% and 18 breweries. It has operations in the Zhejiang, Guangdong, Hubei, Hunan, Jiangsu and Shandong provinces. The company has been active in China since 1984, providing the transfer of technical and brewing know-how to various Chinese brewing companies, including the Zhujiang Brewery in Guangzhou. In 1997, InBev entered the Chinese beer market as an operator with the acquisition of the Nanjing and Jingling Breweries. In 2002, it acquired a 24 per cent share in the Zhujiang Joint Stock Company, China’s fifth largest and most profitable brewer on a per-tonne basis, and a 70 per cent stake in K.K. Group’s brewing business, based in Zhejiang Province...more info

Germany: In 2003, the total amount of beer consumed in Germany amounted to 93.9 million hl, versus 97.1 million hl of beer consumed in 2002, Federal Statistical Office Germany announced on November 8, 2004. The figures include mixed beer drinks and exclude non-alcoholic beer and malt drinks. As reported by the Federal Statistical Office, the average consumption of beer per inhabitant amounted to 113.9 litres in 2003 against 117.7 litres in 2002. This amount nearly corresponds to a small bottle of beer (0.33 l) per day. The figures are presented on the occasion of BRAU Beviale, the annual event of the European beverages industry which will take place in Nuremberg from 10 to 12 November 2004. However, beer consumption in Germany decreased continuously in the last ten years from 108 million hl in 1994 to 93.9 million hl in 2003. Per capita beer consumption declined from 132.7 litres in 1994 to 113.9 litres in 2003.

USA, New York: Anheuser-Busch expects to achieve its sixth consecutive year of double-digit earnings per share growth in 2004, company management told investors and analysts at a presentation in New York on November 9, 2004. In the presentation, management reaffirmed the company’s 10 to 11 percent 1/ earnings per share growth target for 2004. This includes dilution from the company’s acquisition of Harbin and excludes the benefit of a commodity hedge gain in the first quarter. W. Randolph Baker, vice president and chief financial officer of Anheuser-Busch Companies, Inc., also reaffirmed an initial target range of 7 to 10 percent earnings per share growth on a reported basis in 2005, reflecting increased marketing investment and higher commodity costs anticipated next year. Baker added, “We remain confident in our ability to achieve our double-digit earnings per share growth objective over the longer term, with continued improvements in return on capital and a substantial amount of cash returned to shareholders in the form of consistent dividend growth and share repurchase.” Baker told investors that the pricing environment in the domestic beer market remains very favorable and, importantly, is largely consumer driven. This is the eleventh straight year that beers priced below premium have lost share to premium and above priced brands, as consumers continue to trade up. Beginning in October, the company successfully initiated the first stage of its two-stage annual price increase plan. The second phase is expected to take place in the first quarter of 2005, with the two phases combined covering approximately two-thirds of the company’s volume. “To enhance beer volume and market share growth, Anheuser-Busch is stepping up new product, packaging and other marketing initiatives,” Baker continued. To expand beer-drinking occasions, Anheuser-Busch has introduced a distinctive new product called B-to-the-E (B e). B e is a beer-based product infused with caffeine, guarana and gingseng. At the same time, the company has added Bacardi Silver Low Carb Green Apple to its Bacardi Silver family of brands in the flavored alcohol beverage category. Yesterday, Anheuser-Busch also introduced into several test markets a new member of the Bud family, Budweiser Select. Using a long brew process, Budweiser Select has a unique, crisp taste that finishes clean, leaving no aftertaste. This new brand also is lower in carbs and calories than most premium brands. The company is also further enhancing the image of its existing brands through packaging innovation. An important part of this strategy is the national rollout of applied plastic labels for Bud Light bottles, which has been very well received by consumers in its initial markets. In addition, the company recently began offering its Michelob and Michelob Light brands in a unique 16-ounce aluminum bottle package in select accounts ...more info

Canada, Moncton: Molson Inc., America's oldest brewing company, announced on November 8 that it will build a C$35 million brewery in Moncton, New Brunswick by January 2007. This new Maritimes brewery will provide Canada's leading brewer with a unique presence in one of the country's key beer markets. "This announcement is another demonstration of Molson's commitment to the Maritimes," said Daniel J. O'Neill, Molson's President and CEO. "Molson currently employs over 125 people in the Atlantic region. The new facility will bring the total to a minimum of 160, the first year of operations, and make Molson a business and community partner in the Maritimes. New Brunswick's vibrant atmosphere as well as its strong business environment made it a partner of choice." "Building and operating a brewery in New Brunswick affords Molson with local brewer status and the ability to operate warehouses and have a distribution system in the region. It paves the way for Molson to compete more effectively in the region and to realize significant cost savings by being a local brewer," added Kevin Boyce, Molson's President and COO, North America. New Brunswick Premier Bernard Lord applauded Molson's decision to locate in New Brunswick. "Molson is one of the great names in Canadian business and one of the most storied companies in Canada," said the Premier. "Their decision to locate in New Brunswick underlines the kinds of business advantages this province offers." A new Molson state of the art brewery will feature bottling and keg lines and have the flexibility for the future installation of a canning line. Brewing capacity will be more than 6 million 12-packs annually or 250,000 hectolitres. Once fully operational, the facility will brew several of Molson's most popular core brands such as Canadian and Coors Light for the regional market. The new Maritimes brewery will also support Molson's long-term strategy to grow its export business based on its strategic geographic location which provides proximity to the North-east U.S. and access to overseas markets. Moncton was selected to become Molson's hub in the Maritimes for several reasons. Centrally located, Moncton, is a city that boasts a rich tradition in history, a cultural diversity and success in economic development. Furthermore, the New Brunswick government offers a very favourable business environment by providing companies willing to invest with several advantages...more info

Thailand, Bangkok: Thailand's beer market is expected to grow 12% to THB82 billion this year, led by strong growth in the economy beer segment, a senior executive of Thai Asia Pacific Brewery Ltd. told reporters Tuesday, November 09, 2004, Dow Jones revealed. "We expect the beer market will expand by 12% this year, and 7%-8% in 2005," said Panya Pongtanya, the company's general manager. Thai Asia Pacific Ltd. is the brewer in Thailand of beer under the brand names of Heineken from the Netherlands and Tiger from Singapore. Thai Asia-Pacific says its Heineken beer is dominant in the premium beer sector with an 88% market share in a segment worth around THB7.7 billion. The low-end beer segment accounts for 79% of the total market value, or around THB65 billion. It is projected to lead the sector with growth of 13% in 2004 and 8% in 2005. The dominant player is Thai Beverages PCL's Chang Beer, controlling 75% of the segment's market share. Heineken received a boost in the high-end market earlier this year when Thai Beverages fell out with Carlsberg A/S (CARL-A.KC), and started supplying draft Chang to bars formerly serving draft Carlsberg. In July, Thai Asia Pacific launched Tiger Beer, pricing it in between the low end and high end of the market. The company is considering the introduction of a third brand next year, but further details weren't immediately available. Thai Asia Pacific reported a 6% jump in sales to THB7 billion during the 2004 fiscal year which ended Sept. 30. It expects sales to reach THB7.5 billion next year.

China: Scottish & Newcastle announced on November 8, 2004 that, further to previous announcements, it had completed the purchase of 50 million shares in the Chongqing Brewery Co. Ltd, (‘CBC’) representing 19.51% of the total equity and becoming the second biggest shareholder of CBC. The purchase price, as previously announced, was Rmb 525m (c.£34.5m) in cash. The shares were purchased from Chongqing Beer (Group) Co. Ltd (‘CBG’) which remains, after this transaction, the largest shareholder with 34.55% of the total equity.

Malt News

EU malt export licence bookings July 1 – October 26, 2004, are 857,000 tonnes. If the pace of fixations remained unchanged, totals for the crop year 2004/05 could arrive at 2.5 – 2.6 million tonnes. In 2003/04 bookings were 2.4 million tonnes in the old EU. In the calendar year 2003 malt exports of the new members (PL-CZ-SK-HU) were 270,000 tonnes to countries outside the present EU borders. Therefore total exports of 2.6-2.7 million tonnes are needed to put the present campaign at par with the combined sales of last year, market analysts revealed.

Brazil: Brazil apparently purchased approx. 50,000 tonnes of malt for shipment in 2004, two-row spring, Esterel and 50/50 mix. Prices were around EUR 225-230- FOB and US$ 290-295 CFR Brazil (for Esterel).

Chile: Chile is reported for 15,000 tonnes from the EU and 5,000 tonnes from Canada, at prices of US$ 320-330 CIF.

United Kingdom: UK malt export deliveries to the EU and third countries were 381,402 tonnes in 2003 compared to 435,356 tonnes the previous year, MAGB Chairman Euan Macpherson announced in his annual statement at the Armourers Hall in London on November 8th 2004. UK malt deliveries for distilling were 405,073 tonnes compared to 435,071 tonnes the previous year, and UK malt deliveries to UK brewers were 661,074 tonnes (43% of all UK malt use) in 2003 against 653,572 tonnes (41% of all UK malt use) in 2002.

Barley News

Australia: Weather has varied from extreme heat to frost, little precipitation. ABB expects a crop of 5.3 million tonnes. Last Abare estimate was 7.29 million tonnes, now AWB says 6.0-6.5 million tonnes, AWF still 7.17 million tonnes. ABB estimates exportable surplus 1.5 million tonnes feed and 1.0 million tonnes malting barley. Australia is fully sold out in old crop barley. Quotes of new crop barley C+F China are just below US$ 200.

Canada: Harvest is 90-95 % done, market analysts revealed. Damage of September has been worse than thought a few weeks ago, sprouting, fusarium etc. A private estimate is that the CWB malting barley pool will select about 1.4 million tonnes of two-row and no more than 100,000 tonnes of six-row barley. Local needs 0.9-1.0 million tonnes will leave 0.5 million tonnes for export, of which 0.2 million tonnes are sold. In view of obvious germination problems even that figure may be on the high side. Feed barley in (non-Board) domestic market is worth equivalent of US$ 115- FOB Vancouver. Freight to Saudi-Arabia above US$ 60,-, resulting CIF price US$ 175,- or more unsaleable. Total barley crop as per StatsCan 13.04 million tonnes (est. of October 6), may become less in final estimate.

Romania: USDA's October estimate for 2004/05 Romanian barley, almost exclusively an autumn-sown crop, is 1.4 million tonnes, up 159 percent from last year's 540,000 tonnes and 82 % over the five-year average, with its highest yield in over ten years. Autumn sown (fall 2003) barley responded favorably to a moderate winter with mild temperatures and plenty protective snow cover. Precipitation was also abundant in most areas throughout the growing season, FAS USDA wrote. Compared to the 2003/04 crop which endured a harsh winter and a spring drought, this season's 2004/05 barley production will be substantially higher. Excessive rain in June, however, delayed harvest and lowered quality.

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

	Maximum average price for 2RS Malt, crop 2004: 270.50 EUR/tonne - in December 2003
	Minimum average price for 2RS Malt, crop 2004: 237.50 EUR/tonne - in September 2004
	Maximum average price for 6RW Malt, crop 2004: 252.50 EUR/tonne - in December 2003
	Minimum average price for 6RW Malt, crop 2004: 225.00 EUR/tonne - in October 2004

Source: E-malt.com

Malting barley prices. French barley prices.

Nominal prices.

EURO = USD 1.2921 November 09, 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	143.50	121.00	156.50
2RS	Prestige	109.00	141.00	120.00	155.50
2RS	Cellar	109.50	141.50	120.50	156.00
2RS	Aspen	108.50	140.50	119.50	154.50
2RS	Optic	108.50	140.50	119.50	154.50
2RS	Astoria	108.00	139.50	119.00	154.00
2RS	Cork	108.00	139.50	119.00	154.00
6RW	Esterel	100.00	129.50	105.00	136.00

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

Table of the week

EU malt export licence fixations: (in tonnes)   2000-2001  2001-2002   2002-2003   2003-2004  July 01, 2004 - October 26, 2004    France   523,190  701,134  661,772  774,761  292,575   Germany   305,980  468,314  408,063  422,047  116,943   Belgium   277,584  296,368  287,850  317,292  85,339   U.K.    254,793  350,621  294,995  443,501  125,841   Finland   65,550  91,890  100,758  114,165  19,566   Denmark    52,326  96,812  94,791  90,452  25,790   Sweden   50,847  101,000  76,916  78,369  38,190   Netherlands   54,835  51,310  66,219  80,703  15,079   Ireland   26,003  35,145  31,140  38,900  37,404   Austria   4,850  8,840  8,620  60,211  2,541   Spain   3,000  2,400  5,640  10,000  -   Greece   1,800  1,744  1,306  979  130   Portugal   340  221  85  695  425   Italy   -  -  2  -  -   Total old EU   1,621,098  2,205,799  2,038,157  2,432,075  759,823   New EU members  May-June, 04     Czech Republic         34,340  31,439   Poland         7,604  8,513   Hungary         2,830  21,973   Slovakia         1,000  35,450   Total EU    1,621,098  2,205,799  2,038,157  2,477,849  857,198    Total Wheat malt, tonnes   Total 2000-2001    4,686  Total 2001-2002    12,805  Total 2002-2003    30,908  Total 2003-2004    15,768  July 01/2004 – October 26/2004    2,940        Total Roasted malt, tonnes   Total 2000-2001    23,967  Total 2001-2002    23,480  Total 2002-2003    23,603  Total 2003-2004    24,438  July 01/2004 – October 26/2004    10,530

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