EPISODE S.2, E.12

[BARLEY, THE BURIED TREASURE]

[00:00:00] TT: Welcome to another episode of The BrewDeck. Again, I’m your host, Toby Tucker. Today I’m excited to launch into this episode; it is talking 100% barley. I got three awesome guests joining today. First, I want to introduce John Egan, the Territory Manager for Country Malt Group, who resides in the beautiful San Diego area that covers Southern California, Arizona, and Hawaii.
Not only is he a seasoned brewer, but I thought it was fitting to have him on number one as a co-pilot for me. I believe he just finished his certificate in malting from the IBD. If I’m not mistaken, John, I think you’ve knocked it out of the park. What do they call it, scored with honors?
[00:00:42] JE: Scored with distinction.
[00:00:43] TT: Whoa, a little bit different.
[00:00:45] JE: I was pleasantly surprised. I guess all that study time paid off.
[00:00:48] TT: Let’s see if it paid off after talking to these two guys about how much you know. Cool. Hey, John, thanks for joining me today.
[00:00:54] JE: Thanks for having me.
[00:00:55] TT: Yeah, no worries. We also got Ryan Dodd, who’s the Director of Grain, up at our family of umbrella brands, Canada Malting. Hey, Ryan.
[00:01:03] RD: How are you doing?
[00:01:04] TT: I’m good today, real good. Also, we got a returning guest, Dustin Camphouse, the Grain Field Representative at our other sister company, Great Western Malting. Hey, Dustin.
[00:01:13] DC: Good morning, everybody.
[00:01:14] TT: I want to say, first of all, we do have a sponsor today, and it is brought to you by Dallas allergies. I think you guys that don’t live in Dallas don’t know about them, but Dallas allergies, they’re kicking my ass today—just putting that out on the table. Did you guys know that Dallas is number 19 in the top cities in the US for allergies?
[00:01:32] JE: I had no idea.
[00:01:33] DC: I figured you just got into some really yeasty beer.
[00:01:37] TT: That could be the case. Actually, top 20 cities in the US, three of them are in Texas. It feels like right now, I’m walking around in a bubble full of pollen and cat hair. Good feeling. Anywho, let’s get started on this. Guys, thanks for jumping on. I want to spend the time talking about anything and around barley—from growing, to farmers, to what you guys do day-to-day. Let’s start with that. Ryan, tell us about what you do, your role, and what your day-to-day looks like with Canada Malting.
[00:02:08] RD: We have nine elevators across the prairies. I help to manage and oversee the operations of all those elevators, as well as everything going into Thunder Bay, Montreal, and Calgary, the malt plants there. We move a lot of barley. We move around 550,000 metric tons of barley a year. It’s busy, you’re trading with line companies. The everyday operations, you develop new contracts, stuff that’s farmer-friendly, to help get guys to grow more barley, and of course, protects our business as well. Every day, the phone starts ringing when the farmers get up.
[00:02:41] TT: Which is early, by the way, right?
[00:02:42] RD: Yeah, that’s early. I tried to beat them out because I have a cattle herd also. I have a cow-calf operation here as well, as well as a grain farm. My everyday routine is usually full but fun. I love it. This agriculture business and working with farmers is a passion. It’s where I was born, raised, and something I absolutely love. Once you find a job that you can go to every day, and you love it, it’s awesome.
[00:03:06] TT: It’s everything you’ve said there. I’ve been up and spent some time with you, actually your places up there in Canada. It’s awesome. How long have you been with Canada Malting?
[00:03:13] RD: It’d be coming up on 20 years in September.
[00:03:15] TT: Awesome. Great to have you, I appreciate it. We’ll talk a little bit more about the elevators you mentioned and then some of just overall barley production in Canada here in a bit. Dustin.
[00:03:25] DC: Yes, sir.
[00:03:26] TT: Tell us about yourself, what you do, and how long have you been around with Great Western?
[00:03:29] DC: I’m the Field Representative similar to Ryan up there, maybe just a little bit lower on the totem pole. Down here stateside, we do a lot of grow and direct contracting. Rather than owning facilities, we have leased facilities that all of our barley all go into. Clay and I manage the logistics of that, come harvest time, and then logistics of shipping that will receive barley out to Vancouver and Pocatello. There’s another guy out in Vancouver, Clinton Waite; he handles most of the logistics going into Vancouver.
That’s our day-to-day, just contracting and keeping an eye on the crop during the growing season. Like Ryan said, making sure growers are happy and moving forward.
A little bit of my background, I started in the malt industry in 2003 with the big guys—with Anheuser-Busch—and spent some time there, went to the whole grain side, spent a few years in the mall plants, and then back out to the elevators and stuff for a year. About six years ago, I landed here at Great Western Malting. It’s been a lot of fun, really, really good people. Everybody’s passionate about what they do. I think that’s why we click so well with the craft maltsters is we share a passion in our industry.
[00:04:37] TT: I know John very well. John, tell the listeners a little bit about yourself.
[00:04:42] JE: Like Toby said, I live in North County, San Diego—San Diego native. I spent about nine years at Stone Brewing as a Lead Brewer and then another eight years at Mission Brewery as a Director of Brewing Operations and Head Brewer. Now I’ve been at Country Malt for about two and a half years. It’s great. Love it.
[00:05:01] TT: John, prior to coming on board with Country Malt, you were obviously in the brewing world for a long time and spent a lot of time doing it. How much did you not know coming into Country Malt Group and getting to spend time around folks like Ryan and Dustin and learning a little bit more about barley in the process from farm to glass?
JE: I knew very little, which is probably a surprise to some. Especially down here, the beers that we’ve been brewing for the last 20 years or so have been so hop-focused. Most brewers that I worked with in the beginning and still through now, many people aren’t focused on malt. They’re just more into what’s going on in the hop board—going up to Pocatello, visiting the malt house there, visiting the malt house in Vancouver, and seeing that side of the whole industry has been so eye-opening.
I do have some regrets in that I didn’t educate myself more early on. I think I could have been a much better brewer if I had wrapped my arms around what was going on in the malt industry and barley and had a better understanding of it. I’m stoked now. I’ve learned a ton. The IBD course in malting was super beneficial. I’m excited to learn more and continue that.
[00:06:11] TT: I’m learning something every day, so it’s great. Hopefully, our listeners get a chance to get a better feel of what it takes by way of the farmers and folks like Dustin and Ryan and getting selected quality barley into the hands of our maltsters with Great Western Malting and Canada Malting. Cool, I’m excited.
Let’s start with this. You guys may not have these numbers, nor do I, but let’s talk about just general barley growing stats—acres planted in both US and Canada. How much is going to beer in a typical year or human consumption? How does this compare to where we are now to where it was 20, 50, even 100 years ago as far as acreage, and then where you see that’s headed in the near future? Ryan, you want to start with that specifically what you see up in Canada?
[00:06:54] RD: We’ve got a huge amount of acres in for barley this year that will disappear fast. We’re on 12 million acres seeded, and the demand is huge. They’re saying we could see up to 4 million metric tons of barley go offshore this year, which would be a huge number. I don’t think they’ve ever done that with barley because then you still got to move all the canola, wheat, and everything else. And then the feedlots.
We’re in Alberta. We’re in a huge, huge feed area. This is cattle country here right in the heartbeat where I’m at. The pressure on the feedlots is huge because those cows never stopped eating. We’ll see a couple of million metric tons go into feedlots, and then you’re looking at the production here for all of the malting companies. We’re going to need at least another million and a half metric tons here.
There are zero carryovers. It’s a dogfight for any barley out there right now because, of course, those cows are chewing at everything and they need feed. Time is money in the feedlot. If you’re not feeding those cows and processing them through as quickly as you can, you’re losing money, and you’re going backward. It’s competitive out here right now. This is the highest pricing I’ve ever seen. We’ve had upwards of $7.50 a bushel for feed barley.
[00:08:09] TT: Why do we have so much anticipation going to export this year?
[00:08:14] RD: China. Well, their relationship with Australia has been severed. China used to get a lot of their malting barley from Australia. With that relationship being severed, they’ve gone elsewhere. Canadian barley is great. It’s phenomenal stuff. They’re coming to Canada, and they’re buying that up, and they’re driving our prices.
It’s simmered now a little bit with China, but the problem is that everything’s gone. They’re sitting there waiting to see what the new crop will be like, and they’re going to come back into the market. The anticipation right now through line companies—through the Cargills, the […], and JRIs—they believe that they’re going to ship 4 million metric tons off the coast. It’ll be interesting.
We’re expecting a lot of activity at harvest. We’re seeing many farmers who are hesitant to sign contracts right now forward pricing because the markets sold barley at lesser values and the markets ran way up. They think if they hold on and wait, they might see another big increase. It’s difficult, but there’s going to be a lot of barley out there because there’s a lot of acres. It’s just going to be a dogfight to get it.
[00:09:13] TT: Definitely kind of a double whammy. If we got a bunch going to export and then we’ve got a lot of demand that you guys see what’s happening in the brewing world is because hopefully, trickling down away from COVID. We’re just getting hit hard with all kinds of requests. Brewers are full force going back into the market. What that means is that if the listeners out there are taking either the bulk of barley or looking at future projections for their malt needs, they’d take a good look at forecasting and anticipate a potential lift. I put that lightly.
Obviously, the more people you have competing for the same barley, the higher that price will go. John, I’m sure you see that. You have those communications with your customers about what’s happening and what the future looks like as far as the brewing side with malted barley.
[00:09:59] JE: Yeah, absolutely. It’s interesting to hear how the farmers might be holding out of it, making total sense. On our side, it’s the opposite where we’re like encouraging folks that haven’t contracted yet. Hey, get your contracts looked at before that price goes up again. It’s very interesting.
[00:10:16] TT: Dustin, I know things are similar, but obviously different here in the US as far as a barley crop. You look at it on a map historically. In the US, we produce a lot less malting barley than up in Canada, and barley in general. You look historically on a map 50 years ago, you will see that acreage just declined year after year, and most of it is focused up in the Northwest, Central North area. What are you seeing currently as far as what’s going on in North America, what’s Great Western-looking like as far as the crop, and what do you expect for the remainder of the year?
[00:10:49] DC: Farmers and any crop producers are their own worst enemy because they want to do more with less. Naturally, through plant breeding, we’ve gotten better at higher yields on our crops. That can contribute to some of our barley acreage going down over the years. Then it’s been a shift from the Midwest being the preferred growing areas to out west here where we have good irrigation year-round. Then we can grow a high-quality crop year in and year out.
That’s led to the decline in barley acres. The same thing though, the US really doesn’t export a whole lot of raw barley like Canada does. Most of ours are for domestic use. Here in Idaho, probably 95% of the barley grown goes for malting. All domestic use, but then we do get the pressures like Canada sees. They’re cleaned out of all their feed grains, and then people jump into the US market for feed grains. I’ll start with corn, clean out corn, then feed wheat, and then eventually barley; I’ll find them home too.
Like Ryan said, the cows—whether it’s a feedlot or a dairy—they have to eat every day. Everybody’s always looking for a cheap feed supplement for cows. We’ve got that. As far as the crop looks, we’re off to a good start here in Idaho. Some of the other areas in North Dakota, South Dakota, they’re pretty dry in the Midwest. We’ll hurry up and wait, see if they can get any rain. Montana looks good. Oregon looks okay. At least in the eastern part of the state. Southwest down towards K falls in that. They’re in a drought-like everywhere else. They didn’t plant hardly any small grains down in that area this year. That’s about it.
As far as barley acres, barley acres remain static year in and year out across the US, really not a lot of change between 2020 and 2021. As far as pricing goes, it’s been a wild ride watching that.
One thing I can say, at least stateside, we’ve seen it in 2008. The craft guys were starting to take off, and all the small grains just went wild. The guys that didn’t have a contract for their malt got shut out. It’s a pay-to-play world. If you don’t have money and something in place to get the product you want, then you really could be on the outside looking in trying to make some beer with not much malt.
[00:13:09] TT: You mentioned all this is barley going to feed. When I was up with Ryan, he said that their steaks up there were better than the ones here in Texas because they were all barley fed. I hope Texans aren’t listening, but I tend to agree with him. It was a completely different taste. I absolutely loved it, but we got to save it for the brewers, that’s for sure.
Dustin, you mentioned irrigated land, non-irrigated, and I hear that quite a bit. I know it’s all about water availability. Is there a difference as far as overall yield, flavor, profile, et cetera other than just the need for water why farmers decide to irrigate or not?
[00:13:42] DC: Down here, stateside, we’ve got large porous aquifers that hold a lot of water, so you can use a well, pump it on your crops. That usually increases your yield because there’s plenty of water. It’s just like us, they have to have nutrients, and they have to have water to grow or stay healthy, same with our plants. Then up on the dry land areas (and Ryan could probably speak to this a little bit better than us), a dry land farmer always talks about rain. That’s the only thing they will ever talk about because they always need rain.
The irrigated guy, there might be crop rotation, what nutrients, and this that and the other, but 95% of the time, a dry land guy is talking about rain. You usually need at least 10–12 inches of rainfall to grow a decent barley crop, and if you get any more than that, then you’re above average on dry land. The most significant difference is yield. As far as flavor effects and stuff, there might be stuff regionally, but I’m not 100% sold on that one.
[00:14:43] TT: Ryan, I know we talked about water and challenges. Being in the dry land, it’s really in the hands of God. What other challenges outside of weather do farmers usually face year to year when they decide to put barley in the ground?
[00:14:59] RD: Weather is the biggest one, obviously. If you’ve ever seen a barley crop standing at 8:00 in the morning when you leave your yard and you come back at 4:00 that afternoon, and the white combine went through, that’s a hailstorm. That white combine comes rolling through, and it absolutely rotor tills your field. It looks like somebody went out there with a disc. That is probably the most disheartening feeling from a farmer’s standpoint. It’s awful.
[00:15:24] TT: Because it’s done, right? There’s nothing.
[00:15:26] RD: It’s over. Yeah, you got nothing. I mean, you better have insurance because otherwise, you just donated a bunch of mulch to the ground, to the soil. You’re not going to get anything back. That’s obviously the biggest challenge for farmers in this area is the weather. Is it going to rain? Is it not going to rain? Is it never going to stop raining? You hear all those questions.
What is the conversation when you go to the coffee shop? Hey, it’s a nice day out there, it’s raining, or oh, boy, it sure could stop raining now. That’s how every conversation starts. That’s the biggest challenge.
[00:15:56] TT: Here in the city, the only time we talk about the weather is if we don’t have anything to say. We run out of opportunities or something to talk about; we start talking about the weather.
[00:16:04] RD: It’s so funny because here, if you don’t follow the weather, study the weather, and know what’s going on, then you’re probably not going to be very successful. But on the other hand, what can you do about the weather? Nothing. So it’s a double-edged sword for sure.
[00:16:19] TT: Ryan, let’s stick with you here on this one. What’s the most interesting barley variety that Canada Malting brings in now and why? Is there a particular backstory? The one I think of is the Olli from Alberta Heritage Select, or there’s red wheat. What are you excited about? What stuff do you see on the horizon as far as some interesting varieties?
[00:16:37] RD: There’s a lot of them. We have so many varieties that are growing in Canada. I would say we’ve got a couple of new up-and-comers. Fraser is a really good variety. It’s high-yielding and farmers really like it. It’s probably a little shorter straw, so it stands good because if you don’t have good standability, it’ll go flat, then you have pre-sprouting, mold, and everything else. That’s a big benefit.
A lot of it comes down to yield in the field. The producers need the bushels. We got to have that revenue per acre. Those varieties like Fraser or Bow are another one. Those varieties are really starting to pump up the bushels per acre, and then you’re getting that better return for these guys. Ultimately, it’s challenging to get a better return than something like canola. The guys were selling it at $22 a bushel. $6.50 or $7 barley isn’t going to compete with $22 canola.
That’s really why we need these new varieties. We need companies that keep on putting money into developing these new varieties. Otherwise, if we sit and we go stale with an old barley like Harrington, the guys aren’t going to continue to grow barley because the wheats of the world and canola of the world just keep on developing more and more, and their yields keep on increasing.
As far as your question, I’d say right now it’s at Fraser, it’s Bow, it’s stuff that stands up. It’s Cerveza, one that we are looking at purchasing the rights to because it’s really, really good barley. On our dryland acres, we got guys pulling 120, 130 bushel acres. That’s good for us.
[00:18:10] TT: I think it’s important. Just to reiterate the fact that these growers got to make a return on their investment. They’re not just going to put something in the ground because they like beer. They’re going to look at what to put in the ground-based on return per acreage. You mentioned bushels. If we can’t pay anywhere close to another crop, it’s going to be tough to convince them to put it in the ground. Ryan, you and I have talked about this. Barley is not the easiest crop to grow compared to some others that are out there.
[00:18:36] RD: No, definitely not. There’s a lot of stress to barley. You’re worried about the weather conditions here, but then you’re also worried about whether it’ll stand, and then you’re worried about the color and the discoloration because of the humidity. There’s a lot of stress to growing malting barley. That’s why you have to have that premium over top of the feed market. Otherwise, guys are just going to say, “you know what, I’m growing feed because it’s easier.”
It takes a lot of stress off a guy’s shoulders when he’s just growing something that he doesn’t have to put as much time and effort into. He’s not as worried about fungiciding it, using a growth regulator, or something like that. There’s just less input into it, and it’s easier to grow. Also, you’re taking it off at a higher moisture content, so you can start combining a lot earlier than malt barley. September 18th, two years ago, when we had a foot of snow on our crop. If you’re combining at the beginning of September, you’re not going to have the snowstorms that come through.
Let’s face it; it snows in Canada. It can snow every month of the year; I’ve seen it. They’re definitely big challenges. Then the other big challenges too, these guys got to get a return because we got guys spending a million dollars on a quarter section of the land mill. You’re looking at equipment that’s just astronomical. Every time you see somebody driving out into a field with machinery, it’s like, oh, there goes a million dollars.
If you’re not hitting a home run all the time with your farming practices and you’re just willy nilly about stuff, then you’re going to be in a world of hurt.
[00:20:01] TT: Yep, risky. Dustin, what about the US? Any interesting varieties or stuff that you’re seeing or looking at?
[00:20:07] DC: The fall-planted varieties are taking off. There just seems to be more and more work behind reading better varieties for the fall plant and stuff. Right now, our big one is Thunder that comes from Oregon State. That’s pretty cool. The old standby for part of the Pilsen has been wheat malt. We’re looking at a new one to replace that. It seems like after about 15 or 20 years, farmers want just a little bit more. Can we get an extra 10% off of our yield if we switch varieties? The barley breeders do a really good job of always considering that.
Just to echo what Ryan said, farmers want yield. Clay here, my boss, always says barley has to pass three tests, yield in the field, yield in the malt house, and yield in the brewery. The heritage varieties are cool, and there will always be a place for those. When you can send a high extract malt to a brewer, and he’s getting an extra 2% to 3% out of his malt, then that’s a great place that you can go. He’s like, man, this is some good stuff. If they can pass the three Y’s, then we’re kicking butt and moving on to something new.
For us, it’s going to be the fall stuff. The spring stuff is status quo, I guess you could say down here. If they could figure out how to make the fall-planted stuff hardier so we could move it further north and even get it across the border, it’d be awesome. Right now, we have to put that in less temperamental climates.
[00:21:40] TT: You mentioned wheat malt. We see a lot of those winter varieties a little more grown here in the US compared to the UK, where there’s a lot of winter varietals that are grown. There are some differences in that yield or flavor, plumpness, et cetera as far as the end-user is concerned. John, would you agree in your years of brewing? If you’re looking at something coming from the UK on a winter variety versus something that’s spring-planted out here in the US.
[00:22:08] JE: Definitely. The UK malt or the UK barley is typically more plump and there’s definitely that difference in flavor. It’s why a lot of brewers over here stateside, especially in the last few years have moved to Maris Otter. Then there’s been a huge push with barley varieties like Pearl, Halcyon that are really popular. I definitely see that here.
[00:22:30] TT: Let’s jump into Ryan. You mentioned your elevator system. A lot of people may think, elevators, what the hell is that? We’ve got a lot of logistical challenges altogether in North America right now. We see it every day—lack of drivers, retaining drivers, people just not ready to go back to work yet. Then just the uptick of general activity as a whole logistically as things pick up from COVID. How do the CMC elevator systems that you mentioned benefit not only Canada Malting, in our operations, but in turn trickle down to the customers?
[00:23:02] RD: That’s simple. That quality is huge. Those elevators that we have—the nine elevators across the prairies—allow us to capture the quality from the producer, segregate it into small bins. Certain brewers want some high proteins, and some brewers want some low proteins, so we segregate it by variety and protein levels. Then we can ship it into the malt house as a uniform malt. They can do whatever they do in the malting end of it and turn it into a better product for the brewer. It’s pretty simple.
In Alberta, especially, we’ve got trucks. We’ve got a dedicated trucking crew that comes through and haul all of our products into Calgary. You’re turning over barley really quick. It’s guaranteed to be going into the facility. It’s guaranteed what we’re shipping in there are the protein levels that we say. The Thunder Bay and the Montreal plant, they’re a little more reliable and are actually totally reliable on the rail system.
It’s maybe not quite as efficient, but it definitely gets the job done. Our plants in Saskatchewan and Manitoba, there are two plants in Saskatchewan and two in Manitoba. They feed the malt houses in the east, as well as some of the Alberta barley also goes into the eastern plants into Montreal and Thunder Bay. It’s logistically a challenge. Luckily, we have a great team that works through those challenges.
Everybody said that when we purchased the elevators in 2002, all those little elevators were all getting torn down. It all needs to be high throughput now. We had a gentleman who had a vision that, no, this is it. We want those small little wooden bins because the wood of those bins is very soft. So when the barley hits it, it doesn’t peel, it doesn’t deteriorate, and doesn’t lose its quality.
The design of those elevators is gravity fed. It all gets taken through gravity into a front pit into a leg, which carries it up, and then it drops it into a bin. It’s barley on barley, barley on the wood, it doesn’t hurt it. Those little small bins, you’re taking a 100-ton bin and you’re filling it with one producer’s barley off of one field. How can you get any more uniform than that? We believe it turns around, and it shares that top quality that we ship in from our elevators that just shares it right down all the way through the line, right to the brewers.
[00:25:13] TT: As a grower, if I were to only have to drive 45 minutes to sell my crop or put it in an elevator rather than three hours at the same price, I know what I’m choosing. The other thing, Ryan, I may be off base here, but in times of a pinch on the overall availability of barley (and we’ve seen it in the past, seven, eight years) when overall, there’s a scarce amount available for the malting side of things, the elevators in storage have been beneficial to Canada Malting, right?
[00:25:45] RD: Yeah, definitely. On relationships too. I can’t stress relationships enough with our producers. Our people in our elevators have great relationships with our producers, and we have to continue that because ultimately, they’ve got great storage on their farms, and they’ll hold barley for you. You’re going to have to pay for it, but utilizing their storage facilities and then having them bring it into our facilities.
Those elevators, the one year we were long barley, and there was a shortage of the new crop coming, and we knew the quality was going to be poor. We talked with a lot of our local Hutterite groups, and they had areas that they had hailed out. They rented us their bins, and we filled it with barley that we were long. It was top quality, some of the best barley we’ve ever had. We filled all their bins, and then we filled a whole bunch of bags at one of our facilities. I think we put 8000 tons on the ground in great big grain bags.
That top quality that we put away, that stuff carried us well into the new crop year, and it kept a lot of our customers just super happy with our quality. We’re always trying to think. That’s why I say you watch and you study your crop. Right now, you watch your weather; you get in a timely rain, is it raining in the boot? Is it raining during the flower? When is your protein going to be set, and is the crop stressed? You can start following it and see what you’re going to get.
You’re going to get a low protein, high protein, you look at those areas that are heat stressed, that’s going to be a high protein area. You know that area that you need to attack for certain customers. There’s a lot of thinking that goes on. Again, that’s why we’re also stretched across the prairies with our elevators so that we can find this quality, we can segregate it, and keep it for our brewers. It’s a great big huge chess match really, to be honest with you.
[00:27:27] JE: Sounds fun to me.
[00:35:49] RD: It is.
[00:35:51] JE: I want to talk about Great Western real quick. Dustin, one of the things from my day-to-day is we talked about the differences between Pocatello and Vancouver malt houses. Can you give us a little backstory on the history of Pocatello and some of the differences between what’s going on there versus Vancouver and the differences in malt that might come out of those two plants?
[00:36:23] DC: We hit on flavor earlier and you mentioned it too. Growing regions and growing seasons influence flavor, and I also think the malt plants influence flavor. Pocatello came around in 1981. It was when the first part of that facility was built. Vancouver was built back in ‘34. And then in 2017, we increased Pocatello’s capacity with an expansion there. A little bit before that, the rundown of barley history in Idaho has always been a little bit of malt barley growing around.
In the ‘50s, a guy named Robert Hufford started his own contracting company, he’s like a third-party contractor. He’s actually buying malt barley for maltsters. Anheuser Busch did business with them, Great Western did business with them. In the ‘60s is when all that kicked off—late ‘60s. Then in the ‘70s, Coors moved into the area, and then ‘81, we built our facility, and then I think ‘85, Busch built theirs. All of a sudden, you have three major players in the area, all after high-quality malt barley.
That really helps solidify our barley acres here. Like Ryan mentioned, you have to pay up for it. At the end of the day, if there’s a competing crop that will pay more money, the farmer will plant it if it’s going to make him profitable. There’s that.
One cool thing about Pocatello is we can feed it either by rail or truck. It’s not held hostage by either one. Vancouver, like the eastern facilities up in Canada, is kind of held hostage by rail. Since 9/11, there’s port authority trying to get trucks and different drivers in there. It kind of turned into a headache, so it’s just easier to throw it on the rail.
Pocatello, we can run trucks there. It’s turned into a just-in-time facility. We can move 1000–1500 metric tons a day by truck into that facility. It’s the big dog. It just sits there and churns out base malt. That’s really what Pocatello is built for with base malt.
[00:29:59] TT: It’s a great base malt too.
[00:30:00] DC: Yeah. The only real specialty we do there is some distillers malt head back east because there’s one thing I enjoyed more than beer; it’s whiskey.
[00:30:10] TT: I don’t mind it either.
[00:30:12] DC: We got that going for us. Vancouver is our specialty place over there. I mean, they’ve got their […] house, flex house so that they can do all the dark malts over there, all the steam malt over there, so it actually gelatinizes the barley. And then, when it goes to the kiln, it crystallizes all of that. A little bit different product there. That’s how I view it. I view Pocatello as our base, base malt production, and then Vancouver’s our specialty production.
[00:30:41] TT: You mentioned, in the early days, Anheuser Busch, Coors. You got a lot of people in craft just turning their nose up at the big boys. I think we’ve had this conversation—Ryan, I think you and I did. You really look back at the influence the big boys and girls had over craft beer and what it is today. Specifically, very, very particular on their choice, their specs, and their expectation, not only on the growers and what they’re pulling out of the ground, but also the maltsters and their participation in the continuation of new varietals. A lot of these big ones, they’ve got their own fields, they’ve got their own production, et cetera. It’s something that a lot of folks tend to overlook.
[00:31:24] RD: That’s a really good point. It’s something that, I think craft brewers just shunned what’s going on at the larger brewers, what they’re doing. If you think about it, they’re so into consistency and perfection. They want that beer—no matter where it’s made—to be the same exact taste and flavor profile. Craft brewers can learn a lot from the bigger ones.
[00:31:49] TT: Ryan, I don’t know if it’s you or Dustin who was telling me. You guys have had some historical interactions with the Busch guys. Who was it that mentioned something to me, or was it someone else?
[00:31:58] DC: It might have been us. He’s retired now, Kevin Anderson, before Busch moved in; Pocatello used to be a total maltster for Anheuser Busch through the ‘80s and ‘90s. The third flew out here to check things out, and Kevin picked him up at the airport, and every little elevator they went by, he’s like, oh, I want to buy that, we need to stop here. They could be doing 70 down the interstate, and he’d be like, stop, we need to buy that. It’s just the whole mentality of, I’m going to own that, and I think that mentality has slowed down a little bit.
Back to the influence of the big guys on the craft brewers, personally, I think that goes unnoticed quite often because our craft guys, they jump in, and it’s exciting, and we’re doing this, and we’re doing that. But when they started, they didn’t realize they’re using base malt from a big guy. Then let’s go down the Heritage Variety road. Why is my product not the same anymore? Well, because those Heritage Varieties only give you 60 extracts or whatever the case may be.
It’s easy to turn up your nose at those guys and walk the other way, but when it comes to malt barley, they’ve had such a huge influence on the way things are done. It’s just incredible.
[00:33:07] TT: It might have been Travis Vance who was telling me stories about some interactions with those guys. It was quite humorous but interesting. Ryan, you mentioned million-dollar pieces of machinery, et cetera. What automation improvements and use of new tools in your 20 years have you seen? Obviously, there’s no horse in plows but self-driving GPS tractors.
[00:33:27] RD: You start looking at that stuff and then, of course, the new seed drills and the seeding capabilities now. We’re running off a GPS. The fertilizing capabilities of there’s no overlapping so things aren’t getting double fertilized or even your spraying, where all that GPS stuff has really just blown things apart. It’s absolutely phenomenal.
Other things, we had a real disconnect with the oil patch in Canada and agriculture, where the farmers were all 70 and 80 years old. All the kids were all gone. They were going to the oil patch, and they were going into the big cities and finding an oil and gas job. Nobody is taking over the farms. Now, it’s a total reversal where you see the younger generation coming back to the farm. They love the lifestyle, and they’re loving coming back and being able to go out and take a crop from seed link to a finished product. They’re learning more and more. They’re educating themselves up here.
It’s phenomenal to sit down and talk with some of these guys. I’ve grown close with a lot of the younger guys because they’re now starting to educate me more and more on what’s going on. After all, I guess you could say I’m starting to get to be this old dog in the game. The young guys are trying to teach the old dog a new trick. Some of the stuff that they’re doing is just unbelievable. As we keep on advancing, we keep on having the younger generation coming back and advancing their farm; I think that we’re going to get better and better products as well.
[00:34:56] JE: Ryan, do you think that the increase in technology being used by farmers has contributed to those younger generations wanting to come back to the farm? Also, our younger generation is much more savvy with new tech.
[00:35:09] RD: Yeah. It’s definitely that the younger generation coming back is due to the technology in the farm. Also, they can see that somebody’s got to feed the world too. Ultimately, we need our farms to keep on succeeding. There’s a lot of pride in these family farms and stuff. I hate to see that our oil patch in Canada has taken such a huge hit—well, all over has taken such a huge hit.
But that had also pushed a lot of people back because when they came out of school, like, where were you going? They were going right to the patch because they’re making big money. A guy at 18, 19 years old is going to the oil patch, and he’s pulling in $150,000 a year. That’s where they all went, but that’s not sustainable anymore. Now people are looking back, and hey, this farming gig, it’s awesome. It’s almost become cool again. Hopefully, it’s not a trend and it stays cool.
[00:47:07] TT: It’s 100% because the machinery is air-conditioned, that’s it. Nobody’s going to come back if there’s no air conditioning, to be honest.
[00:36:03] DC: And Wi Fi.
[00:36:05] TT: Right. Use of cell phone, TVs.
[00:36:08] RD: Yeah, you go out there and surf the net because the tractor is driving itself.
[00:36:11] TT: That’s right. It has nothing to do with wanting to come back.
[00:36:16] DC: They come with a beer fridge now too.
[00:36:19] TT: Awesome. Ryan, you mentioned in bad inclement weather and when crops are just completely obliterated that people better have insurance. I’m assuming that most of the folks you work with have insurance. I’m wondering how that works. If they have a barley crop that doesn’t pass muster with our malting folks at Canada Malting Great Western. They’re like, no, this doesn’t pass. What we’re looking forward to make is a malting quality barley, and it goes back to feed. How does that work? I’m just curious how that works with insurance.
[00:36:49] RD: Actually, that really is not insurable. If you have a barley crop that doesn’t make malt, then you sell it as feed.
[00:36:56] TT: They don’t insure the difference in what you probably lost out of having to move from malting barley to feed?
[00:37:01] RD: No. What they do insure though is that you can lock in prices. There is price locking that you can insure, so it doesn’t go any less. I guess, in a way, that is the insurance side of it, but not a lot of guys do that. It does cost more money to do it, of course. The biggest things that they’re insuring are all risks, which cover hail, drought, scorching heat, whatever it is. The hail one is the biggest here. Obviously, you can walk out your door, and your crops are gone in half an hour. That’s probably one of the biggest ones.
I hate seeing it. I’ve seen it repeatedly where guys haven’t had insurance, and it can finish them; it can cripple them. The majority of the people carry insurance now. There are some people out there that don’t. They claim they haven’t been hailed out in 20 years, so they average it. I don’t know how that can work because, in my farming operation, I can’t get wiped out in one year. It would cripple me. Ultimately, sure you’ve got land that’s worth millions of dollars, but if you sell your land, you’re obviously going backward.
I would say that for guys who aren’t carrying insurance, they probably got a little bigger gonads than I’ve got. The insurance game, some guys play it. They get hail almost every year, so they go out, and they double insure. They’ll insure through one company, and then they’ll go to a line company, and they’ll insure through them, and some guys triple insure. If they get hailed out, they make way more money than if they took their crop off.
We do say some of those guys play a bit of a game. It’s probably no worse than gambling, but if they’re consistently getting hailed out, I guess it’s a moneymaker for them. There are quite a few guys out there that will do that.
[00:38:37] JE: Talking about insurance and the crops being destroyed by hail, especially up north, do you see farmers rotating other crops that are safer bets than barley? Would they be doing that after a loss crop? Would you see folks may be bringing something in that they could put in much quicker and rather than waiting?
[00:38:56] TT: Well, not just that too. I saw rotation when I was up in Idaho; they did one year of barley, one year of potatoes. Is it all about the soil, or is it just to lessen their overall risk?
[00:39:08] RD: No, it’s soil, it’s disease. You can’t go canola and canola and canola because you’re going to have a clubroot, then the clubroot will morph, and you’re going to come up with something else that’s going to be even worse. You can’t keep on going barley and barley and barley because you’re going to have disease pressure where you end up getting a bunch of smuts or whatever it is. You have to rotate the soil. You have to rotate those crops.
Is it financial? Yeah, I guess. Some guys will rotate a canola crop every three years versus every four years. Some guys are really strict on their rotation to make it four years so that they don’t have that disease pressure, but a lot of it is disease around here. Some of it is financial. You want to get that canola crop back in so you can have that huge cash crop in here. Maybe your beans are huge this year, whatever it is.
There’s a lot of different decisions that go into it, but I know that disease is definitely one of them because you can’t keep thumping the same thing in the ground year after year after year, or you’re going to have some big issues.
[00:40:05] JE: What about down in Great Western in Idaho, Dustin?
[00:40:08] DC: The same thing. Part of it is for disease pressure, part of it is financial. We’re pretty blessed down here; especially you get down to the southwest side over to Burley and Rupert. I think one day driving around, I counted eight different crops in the ground. The bigger guys that can afford to do that help the soil out and make them more sustainable in the long run. The downside to that is your row crops take a different set of equipment than your small grains crops versus your legumes. Whatever the case may be, all of a sudden, your input cost changed just a little bit, your equipment cost changed, and labor on some of them.
Probably the big ones, like Ryan said, first and foremost, is disease pressure. In some areas, they don’t have much of a choice. Up towards our high country dry farms, they can only do small grains. It’s spring wheat or spring barley year in and year out. Some of these guys have been growing barley for 30 years. You get into the fallow ground and try to let stuff sit out for a year, or maybe try to put in a dry land hay crop. I’m with Ryan on that one. 70% of that decision is all based on disease pressure.
[00:41:23] TT: So much to think about. Definitely, a shout out to all the farmers and for what they do, ultimately so that the four of us and a lot of other people can sit down and have a pint of beer. It’s pretty awesome.
Last question, guys. I know you guys have a lot to do, especially as the spring and summer are rolling around. In the wine world, you always hear about a great vintage or a year that was awesome for growing grapes where the stars just absolutely lined, the weather was great. The finished product of that “vintage” was awesome. In your years doing what you’re doing, has there ever been a year like that you can recall where the crop across the board is unbelievable?
[00:41:56] RD: For us, last year was just phenomenal. The one thing that we probably could have used more of (and you don’t hear this very often) is some higher protein stuff. The low protein barley, it was all just plump, it was all white and tight, it was just bright, and it was gorgeous stuff. You throw it into some water, and it’s just boom, it’s starting to sprout. Everything was phenomenal in that aspect. The producers’ yields were good. They were strong, guys were happy, and then the prices started to increase.
That crop last year was a moneymaker for guys. It was excellent, and then the yields in the malt house were phenomenal as well. Everything just kept on working for everyone. One thing we didn’t talk about too is our specialty stuff—our oats, our wheat, our rye. All of those crops were just excellent as well. The oats were just gorgeous. I’ve never seen oats come off a combine that looks like they’d run through a seed cleaning plant and all been sized to perfection. It was amazing and white, tight, bright.
I do all of our specialty product purchasing in Canada. All the rye, the soft white wheat, the red wheat, the oats—everything goes through me. It made things so much easier because you didn’t have to go chasing and looking around for something that came off without getting snowed on. The first year that we started doing the oats went under snow. It made my job a lot easier being able to just select that stuff, put it through a few tests, and it was making great malt.
[00:43:25] TT: I’m glad you mentioned the specialty stuff. We plan on doing another podcast specifically talking about specialty grains. Obviously, barley is at the forefront, but there are a lot of other grains that we, as a group, malt and deal with. It’s for another day. Dustin, what about you, buddy? Any particular year you remember in the US that was just kick-ass stuff?
[00:43:43] DC: Last year, North America just had amazing small grains here. For the majority of our regions, I don’t think any of them got over 100 degrees Fahrenheit. It was just amazing. Our dry farms got rain. We are cool in our lower elevations, so we just had these great big crops everywhere.
I think that’s what’s going to help us get through this next year. Because with everything getting cleaned out, you always want to make sure that you’ve got something on hand. I don’t know about Canada, but we’re supposed to have a hot week next week. We’re supposed to be like 97 degrees, 98 degrees. We usually don’t hit the 90s till July. It’s going to put a lot of stress on the crop, especially our irrigated crops. If there’s not enough water there, it’s going to burn them down.
Last night, we actually froze in some areas. That’ll hurt a little bit. Last year, and then on the flip side of that—the disaster years—I think everybody still likes to talk about 2014 when it rained across all of North America.
[00:44:42] RD: It was awful.
[00:44:43] DC: It’s horrible.
[00:44:44] RD: Let’s avoid talking about that. Those are the ones that people remember. You don’t remember all the rock star years. Whatever, those are wicked. The ‘02 when we bought our country elevators, and we fired up here, and people were burning down their grain dryers trying to get the crops off the field. They bring you in samples, and it would have 20% green sprouts hanging out of it, and you can’t malt that. It’s already malted.
That’s part of the reason why I was saying, oh, you guys buying those elevators, you’re just going to fry, what are you doing? There’s no way you’ll succeed because the barley crops are already germinated. We had one guy that year, and this is not a word of a lie.
He pulled into a quarter section of barley. It was all swaths, it was matted together, and there are green sprouts all the way down the whole row. He put his combine header into it, and the whole row started shaking and just started coming towards him. All the way from the other end of the quarter section. It was all just matted together so tight, and the whole row started coming, and it just plugged this combine solid. There’s nothing you could do.
The sprouts were so bad that they had to get out every hour, two hours. They had to get out of their combines, climb inside of them, and they had to clean out all the sprouts on the sieves because the sieves were plugged, so it wasn’t cleaning the grain. They’re just blowing it out the back of the combine. Oh, man, you want to talk about some grumpy folk?
[00:46:11] TT: Sounds like me trying to mow my grass after it just rained. You got to sit there and get the wet grass out from underneath.
[00:46:20] RD: I’ll send you a couple of cows.
[00:46:22] TT: All good. Hey, guys. I really appreciate your time. On behalf of Country Malt Group, myself, and John Egan here, we appreciate what you guys do. Again, I think it’s something that quite a few of us beer lovers and those that produce the beverage we like—and distillations for that matter—kind of overlook. I appreciate what you guys do. It’s been a real pleasure learning a little bit more about barley, the farmers, and how that all works. I appreciate what you guys do. Thanks for joining us today.
[00:46:48] JE: Thank you, guys.
[00:46:49] RD: Thank you.
[00:46:50] DC: Thank you, guys.
[00:46:52] TT: No worries. All right. Thanks for listening, everybody, for another episode of The BrewDeck. Hit the like, hit subscribe, or whatever the heck you do to continue to get these things in your inbox. I appreciate it, and I look forward to having another one of these really soon. Cheers, everybody. Bye-bye.

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