Early malt signals plea rejected
Predicting cereals demand would be impossible, it is claimed
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A plea for farmers to be given a better indication of forward demand for malting barley from distillers was rejected yesterday.
NFU Scotland cereals committee convener John Picken had called for more market information to be shared between distillers, their maltsters and the farmers who grow the malting barley and wheat that are key to the production of Scotch whisky.
He said this would help take some of the volatility out of the market and allow farmers to plan cropping as well as respond to the challenges of increasing production costs and dramatic swings in the costs of fuel and fertiliser.
He told a NFU Scotland whisky seminar at the show: “We need long termism back into industry. We need to know requirements for the years ahead.”
But Gavin Hewitt, of the Scotch Whisky Association, said it would be impossible for distillers to respond to Mr Picken’s challenge as it was “notoriously difficult” to predict annual cereals demand.
“We do not have a crystal ball,” he said. “I cannot give you the certainty that you desire. We have a growing dialogue between ourselves and I hope we can build on that because I want to give you the confidence that we have a future together.”
Mr Hewitt said the last year had been difficult for distillers because of the global economic downturn and the problems this had caused in some markets.
He was, however, optimistic about the long-term outlook for Scotland’s national drink, exports of which last year hit a record £3.1billion. He saw future opportunities in China and India as well as Brazil, Turkey and Vietnam.
Mr Hewitt used the seminar to renew the SWA’s longstanding plea for reductions in import tariffs, particularly in India where duties remain at around 150%.
Reducing that to zero could lead to soaring sales and catapult India to one of the top five markets for Scotch globally. The expectation was for an extra 6.5million cases of Scotch being sold, a figure that would equate to a 7% increase in production and 7% rise in cereal demand.
Mr Hewitt also expressed concerns about the Scottish Government’s proposals for minimum alcohol pricing, saying the plan needed to be urgently reviewed.
Mr Hewitt acknowledged the biggest challenge facing the whisky sector was ensuring that every part of the supply chain, including farmers, received “good value from it”.
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