Fields of Gold

Fields of Gold

Barley is one of the vital ingredients in whisky,but with shortages and price increases is there going to be a knock on effect?

Production | 01 Mar 2007 | Issue 62

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It is the cornerstone the industry is built on, indeed the core of a good whisky and yet barley remains possibly one of the most under discussed issues.Let’s face it barley tends to be sidelined during conversations about the whisky making process.Distillers will often go to great lengths to discuss the shape and size of their stills, purity of water and the premium quality of their barrels.All this would be for nothing without having a top quality key ingredient.However now this significant grain has come top of the discussion poll for many distillers as poor harvests have pushed up prices – in some instances by 80 per cent – creating panic buying in some sections of the industry.All this has come at a time when many companies are starting to lay down stock in the anticipation of a rise in future demand.Speculation indicates that customers’ wallets could also take a hit as increased production costs and scarcity of stock dictate a probable high street price rise for many brands.Barley prices have rocketed from £200 to £250 per tonne in 2006 to £280 to £360 per tonne this year.This in turn has lead to some firms struggling to source supplies and having to lower their barley standards to secure the much needed grain.Using a lower grade of barley has an effect on the production process, making it less efficient due to a number of factors including reduced moisture content. Essentially distillers will not getting the spirit yield from the malt they would have done if they were using their usual type of barley It has also lead to some companies looking at producing more grain whisky this year than they normally would, in order to sell it on.Dr Bill Lumsden, master distiller at the Glenmorangie Company, says some sectors of the Scotch whisky industry have become almost blasé to the importance of barley.He adds: “It is almost taken for granted that our main raw material will be good, because this is seldom not the case these days.” There are various factors which have had an impact on the world cereals market and malting barley supply.Last year, adverse global agronomic and weather conditions resulted in a poor barley harvest in many parts of the world. As a result, supplies of malting barley have become tighter and costs will be considerably higher in 2007.Dr Lumsden warns of the consequences: “It is a distinct possibility that over the next few years, there may not be enough barley sown in the United Kingdom to satisfy the demands of the distilling industry. That was the case after last year when the situation was exacerbated by a series of disastrous harvests elsewhere in the world, leading to quantities of quality barley being exported from the UK.” Most distillers are passionately interested in the quality of their malted barley, and have resultantly built up very strong, long-term relationships with their suppliers.Dr Lumsden says: “These long-term relationships have helped to ensure that our malt suppliers have gone out of their way to procure appropriate quantities and qualities of barley to satisfy Glenmorangie’s 2007 spirit requirements.“However, this is not the case across the board, and some distillers have had to scale down their production expectations due to not being able to purchase enough malted barley; in some cases, in my view, the strategy of consistently trying to get the lowest price possible with scant regards for quality and specification has not served these parties well.” Robin Gillies, director of whisky operations for The Edrington Group, takes up the thread of working in partnership with growers.He adds: “We have a strong partnership with Simpsons Malt in Berwick which ensures we have a secure supply of barley.“The partnership has allowed us to develop strong relationships with a group of farmers in the Berwick area who grow the barley supplied to us through Simpsons.“We work closely with them to ensure that the barley they grow on behalf of our brands is of a high quality and in regular supply.” Glengoyne’s director of whisky operations, Gordon Doctor also agrees that partnership with local growers is the way forward.He says: “The industry is paying between 40 per cent and 80 per cent more for malted barley in 2007 than it did in 2006.“I know that some companies are sourcing wherever they can and have lowered their specifications but we are fortunate in that we have a long-term relationship with our supplier.” David Williamson at the Scotch Whisky Association says that the whisky industry’s investment in Scottish barley had topped £100m per annum.He adds: “While distillers look to procure locally grown malting barley, it is important to remember that there has never been a requirement to only use Scottish barley.” With the price of barley unlikely to drop back to the 2006 price, what does the future hold for whisky?Dr Lumsden says: “What I think we will see is a higher level of partnerships between the growers, the malt producers and the end-users, leading to some slightly increased stability as a result of better forwardplanning.“None of us want to see the dynamics of this year’s situation being repeated, with grain shortages, panic buying and vastly increased malt prices.“It promises to be an interesting few years for the inextricably linked cereal growing, malting and scotch whisky distilling industries.” SCOTTISH BARLEY FACTS
In 2006, 417,000 hectares of cereals were grown in Scotland
• 298,000 hectares of barley were grown and nearly 96,000 hectares of wheat
• Two million tonnes of barley were produced
• 10,600 holdings grew cereals. One quarter of these farms grew more than two-thirds of the crop yield
• The UK is the third largest cereal producer in the European Union after France and Germany
• The main cereal crop in Scotland is barley and in 2006, 28 per cent of the UK’s barley area was in Scotland. 34 per cent of it goes into malting. 54 per cent goes for animal feed, the rest being used for milling
• There are two types of barley: winter barley is sown in the autumn and spring barley is sown in March or April. 80 per cent of the Scottish crop is spring barley
• Milling wheats grown in Scotland are mainly used for biscuit making. Wheat is also used in distilling and for animal feed
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