MALTING BARLEY growers are calling for reassurances over their grain contracts amid market volatility.

Reports of maltsters allegedly not taking their full contractual commitment of grain from growers – asking them to store a lot of it until next year – is calling into question the state of the market, and how this could effect producers, this year and long term.

However, chairman of NFUS combinable crops committee and East Lothian farmer, Willie Thomson explained that, yes, there are issues to contend with, but things are just running a bit behind and things may not be all doom and gloom.

He told The Scottish Farmer: “It’s true that Scot Grain specifically, have asked some contractors to store 20% of their crops for a bit longer, but it’s not as black and white as that.

“Basically, they’re working on a traffic light system – if you’ve not room in sheds etc because you’re needing to get cattle in, they’re prioritising those people and taking 100% or their contracted quota, but if you do have the capacity to hold onto stocks for a few extra months, they’re asking people to that, with a view to taking it at a later date, when things are caught up.

“Yes the current economic climate is playing its part,” he continued, “and distilleries are maybe taking a bit longer to get back up to 100% running capacity than we would like, but the main issue has been the delay in completion of the new Scot Grain facility at Arbroath. Covid delays mean the new plant is now going to hopefully be finished at the end of October or beginning of November, so fingers crossed that will ease up logistical issues that have arisen.”

With 2019 actually a good year for barley, a lot of producers have good quality stuff in their stores, and Covid has meant that it hasn’t been used, and it’s being estimated that there’s 40-60% more barley in the country than we would usually expect at this point in the calendar.

The fact that, in Scotland, harvest is running late, is also not helping matters.

One industry commentator explained: “Contracts tend to have a lot of wiggle room, so there’s always the suspicion that stores won’t be taken until they are really needed, which puts producers under pressure.

“With Scot Grain saying that they wont be able to take everything that’s being produced, and asking people to keep 20% of their stores until next March, with many producers being told this just before harvest kicked off, people are naturally worried. We do need to remember that Covid has caused a massive upheaval as far as logistics are concerned, so off course we’re still seeing the effects of this.

“It’s a bigger immediate problem down south because the brewing market – which is more instant – is being hit harder than the whisky market.

“It’s certainly true though, that, in Scotland, those without signed contracts could be in bother.”

An ongoing situation, with demand for malting barley used by brewers and distilleries being hit by pub closures, some farms were also affected as their staff work in close proximity or needed to shield or self-isolate, leaving them struggling as far as labour is concerned.

Many believe that we’re yet to see the full impact of Covid on the grain supply chain, with suggestions coming from the grain trade and maltsters that they have a huge carry-over of grain, making it likely for there to be less of a demand for malting barley.