Beer maker says merger won't hurt Montana barely wheat producers

by Christopher Doering

WASHINGTON – Anheuser-Busch InBev’s takeover of competitor SABMiller won’t hurt Montana wheat and barley producers who sell a lot of their crops for beer production, a company official said Tuesday.

Anheuser-Busch InBev announced last fall it would buy SABMiller for about $108 billion in a merger that would combine the world’s two largest brewing companies, with operations around the world. If the deal is approved, the companies would control about 30 percent of the global beer market, with brands including Corona, Beck’s, Peroni and Stella Artois.

Russ Harville, senior director of raw materials with Anheuser-Busch, said the acquisition of SABMiller “will have no effect on our grain contracts with Montana growers.”

Due to a large divestiture here in the United States by SABMiller to Molson Coors, he said the merger will not change Anheuser-Busch’s footprint in the U.S. beer market or its procurement of barley, wheat or any other ingredient used to brew its beers.

The response followed a letter sent Thursday to Carlos Brito, the chief executive of Anheuser-Busch InBev, by Sen. Jon Tester, D-Mont., who said his constituents need to better understand how the proposed acquisition would affect their longstanding relationship with the brewer and whether it would have any “measurable effect” on current or future grain contracts in Montana.

“While there are many aspects of the merger that warrant a thorough and transparent review, I am specifically interested in the impact the merger would have on the wheat and barley Anheuser-Busch InBev purchases from Montana’s grain growers,” Tester said in the letter. “Our producers consistently provide outstanding crops to their buyers and have enjoyed a strong relationship with your company.”

Montana, the third-largest producer of barley and wheat, is a major supplier to the beer industry. In 2013, farmers in Montana produced nearly $1.7 billion worth of wheat and barley on 6.1 million acres of land harvested across the state, according to the Agriculture Department. Much of that went to breweries.

Mitch Konen, a malt barley grower from Fairfield who contracts with Anheuser-Busch for most of his crop, said Tuesday he’s watching the merger but is confident producers in Montana won’t be negatively affected.
“It’s a pretty big deal to our industry to have that outlet for our producers that grow here,” Konen said of Anheuser-Busch and other brewers who buy their products. “We have been pretty much assured that (the merger is) not going to affect us in my local area. It’s going to be business as usual out on the farm.”