Small US breweries have been a major contributor to growth for ASX-listed maltster, GrainCorp, but the Barrett Burston owner reports the segment is slowing.
GrainCorp Malt has had ongoing strong demand for specialty products in the North American craft and global distilling markets, GainCorp CEO Mark Palmquist told analysts yesterday.
“We see that growth continuing, just not at the same rate or pace,” he said.
“We’re no longer in the double digit growth, but we’re in the high single digits.”
Palmquist told ABC Rural that the craft sector’s contribution is slowing down, simply because it has become such a big part of the GrainCorp Malt business.
“It’s 20 per cent of the beer consumption now in the US,” he said.
“[It’s natural] that you would have a natural slowdown on a percentage base.”
Palmquist said the greatest demand has come from small craft breweries that produce beer for on-site consumption.
GrainCorp Malt has developed a “full solution set” for these brewers, supplying them with an entire suite of brewing ingredients via a national network of 11 warehouses across the US.
“We also distribute malt from other malt producers, but then we combine that with hops, we combine that with yeast, we combine with different types of additives,” he said.
GrainCorp reported EBITDA of $161 million for the financial year ended September 30, up from $140 million last year.