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Mexican craft brewers visit North Dakota, MontanaMexican craft brewers visit North Dakota, Montana

All of the brewers belong to Cerveceros de Mexico

July 26, 2019

3 Min Read

A group of craft brewers from Mexico saw their prime ingredient - barley - in the field for the first time ever during a trade team recently organized by the U.S. Grains Council. The team’s visit to North Dakota and Montana connected the brewers with both U.S. farmers and U.S. malting houses to showcase the quality, economic and logistical advantages of using U.S. barley to brew their beer.

“None of these craft brewers had been in a barley field or seen barley in grain form, meaning learning about barley production, barley varieties and malt types from the source was very valuable,” said Javier Chavez, USGC marketing specialist in Mexico, who accompanied the team.

While in the United States this month, the team participated in a barley and malt procurement short course at the Northern Crops Institute and met directly with barley producers and malt suppliers.

“Our team was very impressed with all the visits, including the malting houses,” Chavez said. “Being entrepreneurs, team members detected opportunities to buy directly from U.S. malt producers and saw the advantage of joining forces through a purchasing group to buy larger volumes of malt at a time.”

Team members included second-generation craft brewers who had been brewing for at least five years and entrepreneurs running both craft breweries and other businesses. All of the members belong to Cerveceros de Mexico, the organization that represents both craft brewers and larger market players. The Council has worked with this organization to discuss how the association can make consolidated purchases from the United States, which would provide an economic advantage by forming buying groups.

“Mexican craft brewing represents smaller demand than the larger brewing companies, but the sector has grown almost exponentially each year,” Chavez said. “Early starters are starting to consolidate and are actively investing in their breweries to sustain this growth, while new, smaller breweries are carving out market niches in specialized craft beer bars and up-scale restaurants.”

Under an old tariff rate quota system, craft breweries were largely unable to import malt from Europe as larger breweries controlled the quota. However, competing malt supplies from Europe now have duty-free access to the Mexican market, changing market dynamics and increasing competition for U.S. malt and barley, particularly in the craft brewing sector.

As a result, maintaining relationships and U.S. duty-free exports through the United States-Mexico-Canada Agreement is not just a selling point, but a necessity for U.S. barley and malt to remain competitive in the Mexican market. Mexican brewers can gain an additional competitive edge by buying directly from U.S. producers versus purchasing competing European supplies, usually sold through a broker.

“Craft brewers are loyal to their supplier of choice when they find a product that works in their formulas,” Chavez said. “Through missions like this one, Mexican craft brewers can not only learn about U.S. barley and malt production, but also gain confidence in the quality of U.S. malt, see how the market works and establish business relationships with U.S. producers and suppliers.

“The United States and Mexico are logistically and economically integrated so that craft brewers like the ones on this team can buy directly from U.S. malt producers rather than European distributors - saving on cost and improving on malt quality.”

Source: U.S. Grains Council, which is solely responsible for the information provided and is wholly owned by the source. Informa Business Media and all its subsidiaries are not responsible for any of the content contained in this information asset. 

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