Lack of hops has brewers ailing

How many times is this topic going to be written about. Seems like every year now a different newspaper will run this story using local breweries.

Article published in The Dominion Post this morning 17 May 2014 – Lack of hops has brewers ailing

2009 – No hops shortage as growers tie up (yes me having a moan about not enough hops, but it was 5 years ago)

2010 – can’t find an article yet

2011 – Hop shortage hits brewers

2012 – Hop crop low but stay calm

2013 – Lack of rain puts pressure on hops

It is cool to get some media for craft beer and local breweries, but how about some actual good stories about those breweries. If you are going to write about the hop shortage maybe dig a little deeper as this is old news.

Yes hops are hard to get if you are a new start-up brewery, but a start-up would know that going into this business. Hops are also hard to get if you don’t have contracts in place. Last figure I saw was that 99.8% of US craft breweries had hop contracts. As it is the only way you are guaranteed to get the hops you need.

This has been an issue since 2007. So if breweries haven’t got there act together in the last 7 years, then the don’t deserve to have a moan to the media.

If you are looking to buy US Aroma hops now, you won’t be likely to get a contract for any before 2016, as the next two seasons are 100% contracted. Most smart breweries are now contracting a base amount of hops for 5 years out.

In New Zealand, as in the US, aroma hops are in high demand. It is also a very fast changing market as brewers like to move onto the next exciting hop variety. This may mean they drop past hop varieties that have been popular.

Epic Hop ContractFrom the growers point of view there is a long lead time, 3 years to invest in a new variety. A grower is likely to only consider committing to new plantings if they have a commitment from brewers in the way of contracts. If they can get a 3 year contract they will consider committing to the hops the brewer wants to buy, but 5 years definitely makes it a better business proposition.

The market seems to be working better for the growers these days, with better prices, and real commitments from brewers in the form of contracts.

Brewers should be getting multi-year hop contracts.

Journalists should be writing about the great things that the local breweries are doing, not what they aren’t or can’t do due to a lack of hops.

 

P.S. I recall the good old days back when I first launched Epic Pale Ale in 2006, the prices were incredibly low for US grown Cascade. I was able to import them from the US and land them in the brewery for around $8/kg, when local NZ Cascade was $35/kg. US growers weren’t making much off those hops.