U.S. barley acreage hit lowest level since 1876 as beer demand sinks

Barley, once a major U.S. cereal grains crop, largely has fallen out of favor with U.S. farmers.

U.S. harvested barley acreage in 2024 fell to 1.875 million, the lowest number since 1876 when the country’s farmers harvested 1.702 million, according to the U.S. Department of Agriculture’s National Agricultural Statistics Service.

The decline in acres of barley is the result of a combination of several factors.

Demand for feed barley, which used to commonly be used in livestock rations, has all but disappeared because producers are feeding corn and soybean meal rations. Corn and soybean acreage dramatically has risen as improved varieties have made them economically viable to grow in the northern Plains. A decline in the number of livestock producers in the region and a reduction in U.S. feed barley exports also have contributed to the reduction in feed barley demand.

A small amount of barley annually is sold to pet food manufacturers who primarily use it as an ingredient in dry dog food. But the vast majority of the crop — an estimated 75% — is sold for malting barley, 80% of which is precontracted, said Mark Black, Malteurop North American barley procurement and trials manager.

Black, who spoke during the barley program at the Prairie Grains Conference in Grand Forks, North Dakota, in December 2023 and December 2024, summed up the lack of demand for barley from the beer industry this way: “No beer. No barley.”

That slogan is in sharp contrast to the National Barley Growers Association, an organization that has on its missions page, “No barley. No beer.”

While production of barley has sharply declined, there’s still more than enough of the crop grown to meet the needs of the maltsters and brewers who also have seen a reduction in demand for their product. According to the Brewers Association, a not-for-profit trade association of the craft brewing industry, U.S. beer production and imports were down 5.1% in 2023.

Factors that have reduced demand for beer include inflation, legalized marijuana and a shift in younger people’s alcohol preferences from beer to seltzers, mixed drinks and other liquors, Black said.

Craft beer sales are projected to decline slightly again in 2024 after a decline in 2023. Sales of commercial beer also continue to decline.

The reduction in demand for beer combined with the robust supply on hand in 2023 led to fewer brewers offering farmers less contracted acres than in previous years.

In fall 2023, Anheuser-Busch offered farmers 2024 contracts with prices and acreage amounts on par with previous years’ contracts. But the company later told farmers they would have to store barley for a year to 15 months after harvest, later reducing the storage period to eight months.

Some North Dakota farmers opted instead to contract acres with Constellation Brands, which makes Corona and Modelo, which replaced Bud Light in 2023 as the No. 1 beer sold in the U.S. Modelo continues to hold the top spot. Meanwhile, farmers at the Prairie Grains conference who contracted in 2024 with Anheuser-Busch indicated they expect to store 2024 barley until the summer of 2025.

Anheuser-Busch in November 2024 announced it was closing its malt plant in Moorhead, Minnesota, and selling its elevators in West Fargo, North Dakota and Sutton, North Dakota . The Moorhead plant, built in 1978, processed about 8 million bushels of barley each year to make about 2 billion bottles of beer annually.

Closing the Moorhead plant is a result of an agreement the company made with Rahr Malting Co. to take on the full capacity of malt production for Moorhead, Anheuser-Busch said in a Nov. 14, 2024, statement. Any supply of new barley produced in North Dakota and Minnesota will be redirected to Rahr’s Shakopee, Minnesota, malt house beginning in 2025.

“As we continue to build toward a strong future, we’re updating our malting operations and expanding our decades-long relationship with Rahr, a trusted partner and leading malting company,” Nicole Zaharadka, director of agronomy for Anheuser-Busch, said in a statement. “Anheuser-Busch purchases, on average, more than $50 million a year in barley from our 250+ grower partners across the Midwest, including North Dakota and Minnesota, which is more than any other brewer, and this will not change.

“We remain committed to supporting our grower partners and will continue to source directly from them as we have for the past 165 years,” she said. “We are confident that the actions we’re taking now will allow us to even better serve our customers while also becoming a stronger company and industry leader.”

Farmers at Prairie Grains indicated Anheuser-Busch began offering malting barley contracts for the 2025 crop year in fall of 2024. The contract price per bushel fluctuates based on the Chicago Board of Trade December wheat futures price.

Malteurop expects to offer 2025 malting barley contracts when it has determined commitments from brewers, Black said. Farmers will deliver the crop to MarKit County Grain LLC in Alvarado, Minnesota, or to CHS in Devils Lake, North Dakota.

Total U.S. barley production in 2024 was 144 million bushels, 23% lower than 2023, NASS said. A robust increase in per-acre yields — the national 2024 average yield, pegged at 76.7 bushels, was 4.4 bushels higher than 2023 and nearly 5 bushels above the five-year average — was not enough to offset the decline in acreage, USDA Economic Research Service said.

Barley acreage and production across the northern Plains has dropped dramatically, in line with the U.S. acreage decrease.

In Montana, the No. 1 state for barley acreage and No. 2 for production behind Idaho, harvested barley acres fell to 710,000 in 2024, a 31% decline from 2023. Montana farmers’ yields rose to an average of 51 bushels, a 2 bushel increase from 2023, and production fell 28% from 2023 to 36.2 million.

The most stark changes have been in Minnesota, where the crop has been grown for more than 100 years. Acreage has declined from a peak of 1.2 million in 1988 to only 40,0000 planted in 2024. About 40% of that acreage — 25,000 acres — was harvested for malting barley. USDA’s September 2024 Small Grains Summary pegged Minnesota barley production at 1.75 million bushels, compared to 3.996 million in 2023.

That drop in interest in growing barley has led Minnesota barley farmers to decide to terminate the Minnesota Barley Research and Promotion Council.

The council, established in 1990, collected a 1.5% per bushel fee on barley sales, which has been only about $40,000 per year, officials said. More than 15% of the state’s barley producers signed a petition to terminate the council. Barley growers voted on the proposal at Prairie Grains. Brittany Raveill, communication coordinator with the Minnesota Department of Agriculture, said there were eight votes submitted — seven to terminate and one not to terminate. The council will terminate at the end of the marketing year, on June 30, 2025, she said.

However, while the brewing industry does not need as much barley as it used to, demand remains for malting barley, and companies value their partnerships with farmers, Black said.

Despite decreased acreage, the crop isn’t going away. In contrast to Minnesota, North Dakota Barley Council members in December 2024 voted unanimously to increase their state’s barley checkoff by 1 cent per bushel to 3 cents. The organization will request that lawmakers approve the increase during the North Dakota legislative session, which begins in January 2025. The Legislature previously approved increases in 1997 and 2009 for the council, which was established in 1983.

Besides its use in beer making, barley is an important rotational crop, especially in parts of North Dakota where soybeans and corn aren’t viable options and on land with poorer soils. Including barley in the crop rotation also spreads out risk, North Dakota Barley Council members say.

Rich Horsley, North Dakota State University plant breeder, develops both commercial and craft beer varieties. The checkoff dollars also are used to help fund research of Thomas Baldwn, NDSU plant pathologist who studies barley diseases including fusarium head blight and spot blotch.

“There’s a lot of very good research being done at NDSU,” said Ed Kessel, a Dickinson, North Dakota barley farmer and North Dakota Grain Growers Association board president.

Tags: soybean meal, crop, acreage, U.S., feed barley, demand, beer, corn, grain, barley, Production