IFA says Greencore’s malting barley harvest price is opportunistic

A HARVEST price of €120 per tonne for malting barley was announced yesterday by Greencore Malt, but the Irish Farmers Association described it as opportunistic and below the cost of production.

Greencore Malt said the price had been announced following several meetings on both potential long-term pricing models and 2009 crop price levels between the company and grower representatives since January

“This represents a premium of more than 25% for Irish malting barley over current European prices, and is likely to represent more than 30% premium over Irish feed barley prices,” it said.

Greencore Malt said it has been transparent throughout the process in its endeavour to ensure that the Irish malting industry remains protected for future years.

“We recognise that all parts of the Irish cereal growing and processing sector are facing a very challenging year. However, Greencore Malt has been active and transparent throughout the process, consistent with an overarching objective of ensuring that Ireland retains a competitive malting industry,” the company said.

IFA Grain Committee chairman Colum McDonnell said Greencore Malt, as one of the largest maltsters in the world market, was abusing its dominant position.

“Farmers have seen dramatic changes in their contract at the 11th hour, which included a 20% cut in tonnage and the introduction of new standards.

“The company has made healthy profits from their malting business in recent years and now is attempting to force through a price that is significantly below the cost of production,” he said.

Mr McDonnell said this threatens the future of Irish malt and malting barley production, as prices are €20/t to €30/t below what it costs to grow and harvest the crop.

“Greencore Malt’s price offer of €120/t puts the future of malting barley growing in Ireland in doubt. Farmers are not in a position to carry losses two years running.

“While the company has increased the maximum moisture content to 22%, this is only a token concession in an extremely difficult year, both weather-wise and financially for growers,” he said.

Mr McDonnell said there is no future for malting growers at these price lows. Growers would be better off had they put the single farm payment in their pocket and left the land fallow.

“The maltsters, brewers, input suppliers or the machinery manufacturers are not prepared to work for nothing. Likewise, farmers cannot be expected to so,” he said.