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Bye bye, barley?

Skagit Valley Malting closure has grain growers scrambling

Amber waves of grain are beautiful, until you can't sell them.

Dave Hedlin's barley fields along Chilberg Road – labeled "Spring Malting Barley" on crop signs – will be ripe in about a week, along with several other fields tucked in around La Conner.

Unfortunately, Hedlin's barley buyer, Skagit Valley Malting, closed abruptly on Friday, June 16.

Hedlin grows about 100 acres of conventional barley and 100 acres of organic a year for Skagit Valley Malting, which turned locally grown barleys into craft malted barley for 272 brewers and distillers.

The Good Beer Hunting blog reported that when it closed, Skagit Valley Malting had 3.5 million pounds of barley under contract from growers, worth about $500,000 for farmers. It will file a Chapter 7 bankruptcy, the Washington Beer Blog reported.

Brewers and distillers are turning to other malting companies to buy replacement product. Hedlin Farms, along with growers Knudsen Farms and the Washington Bulb Company, is looking for a new buyer for its barley.

According to the Skagit Valley Herald, Skagit Valley Malting had purchased about $6 million in local grains from Skagit growers since 2011. The premium price it paid for barley was helpful to Skagit farmers.

"They filled a nice niche," said Hedlin. "Skagit Valley Malting allowed us to grow the grain we need for rotation and have a margin at the end of the day. If something isn't put together, we will lose that top tier (price) and maybe sell it for cow feed or into some other market."

John Thulen of Pioneer Potatoes grows organic and conventional barley for Conway Feed, a steady buyer of locally sourced grains for animal feed.

"Winter wheat used to be king of the rotation crops, but it got to where either winters were too wet or bird pressure was so high that we couldn't grow it anymore," Thulen said. "Barley became popular because the birds don't really like it, and you can plant it in the spring and know you'll attain a crop."

The high-profile Skagit Valley Malting was one of a number of "value-added agriculture" initiatives intended to help farmers earn more money for their crops.

"Finding ways to differentiate ourselves in the market place is key," said Hedlin.

Skagit Valley Malting and Cairnspring Flour Mill purchase grains for much more than the U.S. commodity market price. Niche grains developed by the Washington State University Bread Lab also draw higher prices. Hedlin grows wheat for Cairnspring and 30 to 40 tons of a WSU-bred hull-less barley for Row 7 Seed Company, whose website says it is led by "chefs, farmers and breeders striving to make ingredients taste better before they ever hit a plate." That contract is still good.

Meanwhile, Hedlin is also talking to other prospects as the harvest clock ticks down.

"Skagit Valley Malting is not the only game in town by a long shot, but it was a game that had some significant volumes," he said. "But that's the farming business. You play the cards you're dealt. This could be a lot worse. I'm optimistic."

 

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