WA growers tap into Asian beer market

Located on 28 hectares next to Interflour's flour mill, feed grain storage facility and port 100 kilometres from Ho Chi Minh city, the malting facility looks set to bring big benefits to WA barley producers.

Run under the name Intermalt, the facility will initially have a production capability of 110,000 tonnes, but this will be increased to 220,000t when stage two is finished.

In stage one of the project, malt will be sold domestically within Vietnam, but in stage two opportunities to trade within the greater South East Asian region will be looked at.

Intermalt Vietnam general manager James Kirton said the malt plant would essentially piggyback on the wheat supply coming through the Interflour mill.

CBH owns half of the Interflour business.

"Vietnam is the second largest beer consumer in the world and the market is growing," he said.

"The site is perfect for a malting facility, we have access to our own port facility, which is an agricultural produce only port, and there is reduced contamination risk, which is very important to brewers.

"We will also deliver direct to customers which is another big benefit."

Mr Kirton said Interflour created a strategic plan for developing its port facility in Vietnam in 2010.

"The focus of this strategy was to develop the vacant land with grain processing facilities that would either leverage Interflour's existing bulk supply chain or increase the throughput of the port," he said.

"While developing the plan it was identified that there was a gap in the Vietnamese market for a domestic malting business operated to an international standard.

"Interflour realised that this business would both leverage its existing WA bulk supply chain and increase the throughput at the port."

Mr Kirton said Intermalt would aim to source 80 per cent of the barley it needs from WA.

"The bulk supply chain efficiencies and quality of malting barley makes WA our first choice of origin," he said.

"The malt plant is set up to receive barley from origins outside of Australia as well, however given the supply chain efficiencies that can be achieved through sourcing from WA we expect that WA barley will form the basis of Intermalt's annual procurement plan."

Mr Kirton said WA growers will receive direct benefits from this investment.

"WA growers will have the opportunity to sell barley to Intermalt and diversify their selling options, be linked directly to the Vietnam market and later to the greater South East Asian market and work with Intermalt to generate new value for the growers, similar to what Interflour has already done with grower groups like SEPWA," he said.

Beer consumption in Vietnam has grown steadily in recent years.

In 2013 2.93 billion hectolitres of beer was brewed in Vietnam and the Vietnamese consume approximately 32 litres per capita, which makes it the largest beer market in South East Asia and the third largest beer market in Asia – behind China and Japan.

Construction of the malt facility will take two years to finish from full mobilisation to site in the third quarter of this year.

* The reporter travelled to Vietnam courtesy of CBH Group.