Markets

China’s wholesome appetite for Australia’s barley

Henry Wells, June 20, 2017

 

CHINA has been the anchor in a massive export year for Australian barley, taking a whopping 3.4 million tonnes (Mt) of the total 5.7Mt of barley shipped from October 2016 to April, according to Australian Bureau of Statistics (ABS) export data.

In April China took 205,680t of Australian barley to supply domestic customers including the dairy and other livestock sectors, and its malting and brewing industry.

table 1 Australia barley exports to China

‘000t : source ABS

Markets

More than 20 countries regularly import cargoes of barley from Australia, where malting and feed customers in destinations including Japan, Taiwan and the Gulf States have decades’ familiarity with Australia’s dry, bright and clean grain.

However, the free-on-board (fob) price and freight costs impact on the competitiveness of Australian barley into another major volume market, Saudi Arabia, which imports around 10Mt per annum of feed.

ABS export data shows it has taken only 419,000t of Australian barley since October, a function of Australia’s inability to compete on price in optional-origin barley tenders, where Black Sea and Western European ports have prevailed.

Saudi, as with all Middle East destinations, buys barley to feed to livestock.

 

Australian barley exports, marketing year to date October 2016 to April 2017 : China 3,402,000t, India 81,000t, Japan 715,000t, Kuwait 108,000t, Saudi Arabia 419,000t, Sri Lanka 126,000t, Taiwan 115,000t, United Arab Emirates 260,000t. Source ABS

 

Compared with malting and food usage, feed barley quality parameters are not as stringent on factors such as colour, test weight and protein.  Malting customers need to be able to germinate barley to convert it to malt.

Many of Australia’s buyers have long-established relationships with the barley industry, but none has such a prolific impact as the volume customer China.

Shipments of significant volume also went to Japan 146,000t, United Arab Emirates and Saudi Arabia each 117,000t, Taiwan 80,000t and Sri Lanka 60,000t; a total of 801,050t of barley was exported in April.

 

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