*It's a recipe for disaster.
This is one business that doesn't need much more consolidation/pricing power.
We follow the barley/malt market on a sporadic schedule, the thinking is you don't want a bunch of angry beer drinkers, see Bürgerbräu Keller, 1923, for example.
From Australia's Stock & Land:
One more conquest for GrainCorp?
GRAINCORP'S strategic $46 million purchase of four malt houses in Germany last October leaves the company with just one key region into which it is likely to spread its footprint.
While he is not suggesting the company is on the hunt to acquire more plants just yet, GrainCorp Malt chief executive officer Steve Haydon said South America was a major barley production region and a growing beer marketplace.
Argentina, in particular, was a significant malt barley producer and other big maltsters, notably Cargill, were active in the region.
"Looking at the long term picture it's the one area where we don't have our malt business represented with a processing operation," Mr Haydon said.
The strategic risk management advantages which GrainCorp's 1.4 million tonne malt business enjoys because of its global footprint have become obvious since last year's purchase of Schill Malz.
Apart from neatly complementing GrainCorp's newly opened grain marketing office in Hamburg, Schill gave the malting division direct access to the world's biggest malt barley crop in mainland Europe....MORE