Here is an interesting bit of fact-based reality in an article on potential increases which may hit the beer ingredient market:
Barley prices have steadily inched up each month, ending 2006 averaging $3.19 per bushel in December -- an increase of about 24 percent from December's average price of $2.57 in 2005. Meanwhile, production has fallen 15 percent to 180 million bushels, down from 211.9 million in 2005, mainly due to droughts in Australia and the Midwest and more farmers choosing to grow different crops like corn and soybeans...A 1 percent increase in the cost of goods sold typically translates to 0.5 percent reduction in volume, meaning consumers typically buy less, van Brugge said.That is quite the bit of knowledge. Given that there is some concern for the price of hops, it will be interesting to see if any of this plays out noticeably at the cash register.
Molson Coors Brewing Co. may be in more danger than competitor Anheuser-Busch since Molson will be faced with spiking aluminum costs. The Golden, Colo. company's aluminum price cap expires this year. Aluminum prices for Anheuser-Busch, meanwhile, are capped. Aluminum accounts for about 20 percent of brewers' cost of goods sold while barley makes up 8 to 12 percent typically.