Alberta remains world leader in malting industry

By Tim Kalinowski, Staff Writer

The malting industry in Alberta is an industry world leader with a North American-wide distribution base. However, while malting barley as a crop has been prolific on the prairies for nearly a century,  malters cannot always find a market for it; leading to a decline in overall acres planted.

Rahr Malting’s Supply Chain Director Kevin Sich says it’s a problem the industry has been concerned with for some time, but can do very little about.

“That has been the knock for the longest time; that we were only using maybe 20-30 per cent of what farmers are growing,” confirms Sich. “So a lot of farmers have backed away from the malt barley business; because they couldn’t find a market.

“Our plant can only do so many tonnes a day so when I’m full, I’m full. I can like the guy, and have the greatest barley ever, but I have no market for it… So there’s ample supply; let’s put it that way.”

Sich is optimistic recent advances in the craft beer brewing industry may continue to open up more capacity for growers.

“Demand has increased some,” confirms Sich. “That being again because of the craft movement. Craft brewers tend to use a little more malt in their beers… We have told farmers that is good for their industry. So farmers, if you want to promote your industry, drink craft beer.”

Sich cautions, though, that enthusiasm for the craft brewing industry must be tempered with some perspective on the industry as a whole.

“Alberta has been the mainstay of the malting barley business for the last 50 years. Nothing has really changed, I just think the perception in the public with the craft brewing industry has made malting ‘sexy,’ so to speak. (At Rahr) we have been in the craft brewing industry for ten years. It’s just in the last year and two that more in Canada are starting to take notice; ‘hey, there’s a craft brewing industry.’ It just really wasn’t in the limelight until the last year or two. All of a sudden ‘craft’ has become the buzzword, right?”

Sich says there may also be a little robbing Peter to pay Paul going on in the brewing industry. North American drinking habits have been changing. There is definitely more craft beer drinking going on, but there has also been a decline in overall beer consumption. Much of it has to do with aging population demographics. Sich has noted it in his own drinking habits as well.

“I don’t drink a 12 pack of beer anymore;  I have two (cans). And a lot of the younger generation will have a six pack. So people are buying the craft beer, and they are going away from the big name brands. So there is a net gain but it’s not as big a gain as some might think. I think it’s important to put that in perspective,” he says.

For Rahr Malting these cycles are all part of doing business. Beer continues to be a popular beverage around the world, and the beer business will always need its malting barley and it malters.

“Rahr Malting and our competitors have been quietly going about our business for years, and farmers have been growing malt barley for 100 years. Nothing’s changed,” says Sich.

On the growers’ side, however, Sich cautions it is important to do your homework on the malting industry and plan ahead.

“We usually do our production contracts in January for the next year’s growing season,” explains Sich. “We tell farmers if they want to have a market they should be looking at signing already in January for it. Don’t just grow the barley hoping you will find a home for it.

“You can do that with wheat or canola more, but with malting barley you need to be planning already (in October) to sign a marketing agreement for next year.”