The price of brewers grains has risen rapidly in recent weeks. This week, the price is also increasing further. This clearly deviates the market in terms of seasonal pattern from other years, in which the price increase is often only visible towards autumn. In the meantime, there is very little to do in the roughage trade. (Dairy) cattle farmers are waiting for a new supply of straw.
The DCA indicative price of brewers grains is rising this week by €0,10 to €3,70 per percent dry matter. Only in 2023 was the price higher at this time of year, but it should be taken into account that raw material prices reached a very high level due to the war in Ukraine. The price has recently also been above the spring level of 2022, when brewing was significantly reduced due to the lockdowns. The limited availability then resulted in a high brewers grain price.
A price increase at this time of year is not common, as suppliers also note. In the summer months, more is usually brewed to meet the peak in demand for beer consumption. The price of spent grains often increases in the autumn, when beer production is scaled down again towards the winter months. The fact that the market is behaving atypically this year is because breweries are struggling with disappointing sales figures. A shrinking European beer market is a trend that has been going on for some time, but is increasingly making itself felt in a tighter supply of spent grains.
Where supply is under pressure, demand for brewers grains is described as good. This is partly due to the dry spring. Despite the rainfall of the past few weeks, the price continues to rise for the time being. Insiders do expect that the top in the market is not far away. Especially since the prices of soybean meal are under some pressure.
Straw price still stable
The roughage trade, on the other hand, is at a low ebb. For the time being, the record high straw prices are still holding. For the eighteenth week in a row, the DCA indicative price remains at €185 per tonne, for both barley and wheat straw. These are probably the last weeks that the price remains stable. Historically, the market starts moving at the end of June when new straw is offered. In recent years, this has always led to a (slight) price drop.
Traders expect a further drop in prices this year, although they are cautious. The current high prices are based on a tight supply situation. If the large volumes from France and Germany become available, this will almost certainly lead to lower prices. However, the weather during the grain harvest will determine the quality.
Compared to last year, the area under cereals has increased. According to the European Commission, 50,3 million hectares of cereals were sown in the EU this year. This is an increase of 2,5% compared to the 49 million hectares last year. More than 42% of this total – good for 21,17 million hectares – is wheat. This is followed by barley with 10,29 million hectares.
In France and Germany, production increases are also estimated compared to last year. However, the supply situation remains relatively tight, with estimates in both Member States remaining below the five-year average.
Click here to view the DCA indicative prices in the database.