Boortmalt incident leads to contract fears for barley growers
There is growing unease among tillage farmers that the tonnage of malting barley processed by Boortmalt in Athy this harvest could be slashed following a major incident at the Kildare site.
The partial collapse of a steep at Athy plant last week is still being investigated, but a number of industry sources maintained that the incident will seriously affect throughput at the plant.
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Malting barley growers stand to lose as much as €2.5m if production is restricted at the Athy facility and farmer contracts are impacted as a result.
It is understood that malting operations at the site could be reduced by 60pc or around 70,000 tonnes.
The Athy site usually takes in around 120,000 tonnes of malting and distilling barley each year. The implications of the Athy incident were still unclear as the Farming Independent went to press.
Boortmalt representatives declined to comment when asked what impact the Athy incident will have on malting barley intakes at the plant, and whether the company will honour its contracts with growers.
The company simply stated that: "Boortmalt's investigation into the incident at its Athy site is ongoing. Until the investigation is complete, Boortmalt will not be in a position to provide additional updates."
Farmer fears that Boortmalt could invoke a 'force majeure' clause in the grower contracts and take a reduced proportion of the agreed malting barley tonnage have been dismissed by IFA.
"My understanding is that the 2019 contract will be honoured by Boortmalt," insisted IFA grain committee chair, Mark Browne.
Mr Browne maintained that Boortmalt will honour their contracts and support growers through the 2019 harvest.
It is estimated that growers stand to lose close to €2.5m were Boortmalt to invoke 'force majeure' and purchase just 40pc of their malting contracts.
Such a move would consign up to 70,000 tonnes of malting barley to the feed barley market, with a consequent price reduction of €30-€35 per tonne for growers.
The incident at Athy comes as the first of the malting barley crop has been harvested. Crops sown last winter are reporting excellent yields and proteins.
Crops harvested near Carrigtwohill in east Cork yielded 3.3 tonnes per acre, at eight per cent protein. Yields of up to four tonnes have been reported, with protein at around nine per cent. These crops are going for distilling.
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