Irish Grain Growers hit out at Boortmalt-IFA deal

The Irish Grain Growers’ Association has launched a scathing attack on both Boortmalt and the IFA (Irish Farmers’ Association) for their recent malting barley deal.

In a statement released yesterday (Monday), the growers’ group said: “Last month Boortmalt, the dominant player in the Irish malting industry, concluded a two-year deal with the IFA, which the Irish Grain Growers Group calls on malting barley growers to reject.”

The group went on to state: “The future of the indigenous malting barley industry is at stake. The deal is the latest chapter in a long-running effort by Boortmalt to progressively squeeze growers’ margins through inadequate headline prices, tightening specifications and additional costs/charges.”

Also Read: IFA concludes Boortmalt malting barley deal, in a bid to address growers’ concerns

The group also criticised the IFA, who it said “has abjectly failed to defend growers’ interests to such as extent that the only reasonable conclusion is that they are fundamentally compromised”.

The group states that many tillage farmers are now either reducing their malting barley acreage or leaving the sector altogether, and points out parallels to the Irish sugar beet industry. It also notes that Boortmalt is currently importing grain and predicts these imports to increase.

In its statement, the group said: “Given the recent revival of the Irish distilling industry, once the world’s largest, it would be a national scandal that the raw materials would have to be imported.

The relationship and history between traditional Irish malting barley growers and Guinness would be lost, a key marketing tool used by Diageo at present in the Guinness Storehouse and in advertising campaigns. The damage to ‘brand Ireland’ would be incalculable.

Citing one example, the Irish Grain Growers’ Association said: “The distilling barley specification is a source of huge frustration to growers. Boortmalt demands in 2017 that each grower must deliver for 30% of their contracted tonnage of barley with a maximum protein content of 8.8%.

“What will the percentage be in 2018 or 2019 ? By way of comparison, European malting barley growers have a much broader protein range of 9.5-13%. Boortmalt claims that growers can meet these specifications without a loss of yield, which is in conflict with independent research by the state body Teagasc.”

The Irish Grain Growers’ Association listed out a series of grievances with Boortmalt.

These included unjustifiably-inflated seed costs from the malting company, outsourcing the growing of malting barley to other merchants with “no restrictions in place”, taking “unprecedented decisions to remove contracts from growers mid-season”, and “increasing chemical input costs by up to 10% in 2017 compared to last year”.

The group took issue with the IFA for not allowing a vote on the deal and for “steam-rolling” the deal through, and for the timing of the deal, saying that “the additional distilling tonnage requirement with no financial incentive was only presented after the crop was sown”.

The group also took exception to figures quoted by the IFA, commenting: “The figures they are mentioning are grossly exaggerated compared to the reality of what’s actually available from merchants for feed barley.

The premium is closer to €10 than the €30+ that they mention and that’s just for the grain that passes.

The group questioned the IFA’s loyalty to grain growers, stating: “Their interest and loyalty is elsewhere in the agricultural sector. Keeping grain cheap suits the IFA to keep the majority of their members happy by reducing their costs.”

The group said that it had requested a meeting earlier in the year and has forwarded its malting barley proposal to them but had received no reply. The group said: “By our calculations we represent approximately 50% of malting barley growers. Boortmalt must respond to our request.”