How much does it cost to import French barley?
There’s been a lot of talk about importing barley into this country of late and malting barley in particular.
Last week, Boortmalt told AgriLand that the Irish farmer is being paid a premium of €35-40/t above the French farmer for malting barley, when moisture and distilling bonuses are added in, as well as things like transport allowances.
However, what is the cost of getting that French barley to Ireland? AgriLand took a closer look.
For starters, the Free On Board (FOB) Creil price (two-row malting barley) this week opened at €187/t (March 18). That is the price loaded onto the boat. Once on the boat that barley has to be shipped. The costs are outlined below.
Freight costs (shipping)
Freight costs can vary, depending on many different factors.
Figures provided to AgriLand by the Agriculture and Horticulture Development Board (AHDB) estimate the freight cost from Nantes in France to the Port of Waterford at €18-19/t, when transporting between 4,000t and 6,000t of barley.
Once landed at the port in Ireland there is a handling fee. This is relatively small and may vary from €3/t to €5/t.
Transport from the port
The barley then needs to be transported from the boat to its destination – that may be a store or a malt house. A reliable figure for transporting grain from Belview Port to Athy in Co. Kildare is €12/t.
Cost per tonne
By adding these figures together, it’s evident that a small load (4,000-6,000t) of French malting barley – arriving in-spec, screened and at 14.5% moisture content – could cost in the region of €220/t and €223/t.
Importing at a larger scale (10,000-13,000t) reduces this figure to between €219/t and €222/t.
Accounting for moisture content
Year-on-year the average moisture content of Irish barley can be taken as approximately 18% and, therefore, it can be estimated that drying costs are somewhere in the region of €30/t.
The cost of screenings can be taken out as a percentage thereafter.
Storage will be required in either country, so this may be taken out of the equation. Other costs such as testing and running of intakes may also need to be factored in for home-grown barley.
Price to the Irish farmer
Taking the high and the low price of the French barley in the chart above at €219/t and €222/t and deducting the drying cost the Irish farmer appears to be competitive with their French counterpart at a green price (20% moisture content) of €189-192/t.
If we deduct the €30/t drying costs from €228/t, the price for the Irish farmer moves to €198/t.
While many Irish drinks are currently being made using a percentage of imported ingredients there is no doubt that these brands need Irish produce to continue to grow in popularity and sustain their advertising campaigns.
So what is the cost of those Irish ingredients and what is the price of that ‘Irishness’? Irish farmers continue to say that they await a premium for their product. Looking at the figures above it would appear that they are not being paid that premium.