From paddocks to pubs: how global beer trends are affecting Australian barley

“A reduction in drinking obviously hurts beer companies, but it also hurts farmers,” said Dennis Voznesenski, CommBank agriculture and sustainability economist. 

The slowdown is flowing through to malt barley growers, responsible for a key ingredient used in beer production. 

Beer demand is falling globally 

Recent financial data from the September quarter of 2025 showed global beer sales volumes declined over the past year, with the largest falls recorded in the United States and Europe. 

Asia has held up better, but overall demand has weakened. 

It’s not just changing tastes 

Shifts in alcohol preferences are part of the story, but economic conditions are also playing a role. 

CommBank economists forecast global economic growth of 2.7 per cent in 2026, down from the historical average of about 3.7 per cent. 

“That’s a full percentage point lower than what we’re used to,” he said. “So if we’re not drinking because economic times are tough, this year might not be much different.” 

What happens to barley if it’s not used for beer? 

Beer relies on malt, which comes from malt barley grown by Australian farmers. When beer demand falls, that barley needs to find another home. 

“If you’re not making beer out of it, you feed it to animals,” Voznesenski said. 

Barley is commonly used as livestock feed, particularly for cattle, when brewing demand softens. 

But feed demand may also be weaker 

Domestic feed demand for barley is expected to be reduced this year due to new Chinese quotas on Australian beef exports. Less beef demand from China could reduce the amount of cattle required to go through feedlots. China is a large buyer of high-quality grain-fed beef. 

That combination - weaker beer demand and uncertain feed demand - highlights how global consumption trends and trade politics can quickly flow back to farmgate outcomes. 

“It shows how connected everything is,” Voznesenski said, adding, “what’s happening with both drinking habits and Chinese beef demand really does matter for Australian farmers.”