Craft beer boom causing hops shortage

Not again…anybody hear about this impending hop shortage?

I think this is supposed to make panic.

Being  in a growing related field I firmly believe it’s an issue and will continue to be as craft brewing continues to explode but the growers are right to not simply expand and then get stuck.

Knowing brewers getting in the commercial game I hear them lament at the difficulty they have getting certain varieties and the contracts they have to battle for to ensure their popular beers remain the same.

My belief is that if you brew great beer your followers will adjust, find and use hops that you can get and be creative, that’s what craft is all about and it can be used to sell creativity and save money at the same time if it’s done the right way.

Eventually things will even out as the producers start to catch up to the brewers demands but nature works a lot slower than brewers:)

+1.  I love Amarillo, Simcoe, (and like Citra in small doses), but great beer can be made with lots of lesser used hops.  Plus, experimenting with hops is fun !

Absolutely and that’s my point, almost every beer I find on the shelves these days is all about the popular hops and honestly, it gets kind of old and they all start tasting the same, change up the hops and experiment with styles and keep things fresh, if the end product is good and you market it properly it’s a win win for everyone!

Totally agree. I even use noble hops in hop blends, to get a slightly different character outside the norm. And a blend of the same 4 hops can give surprisingly different results if you change the ratios of each in different directions. Lots of possibilities.

+1.  Hop Contracts exist for a reason.  The biggest shortage would fall on the homebrewer if the small craft brewer wont pick up a contract.  The Homebrew distributors have contracts to fullfil supply to their HBS,  Since craft brewers dont tend to pay retail prices, i think we will be ok for MOST varietals.  If you are worried about certain varietals grab a few lbs at harvest time and store them in a freezer,  that is all the distributors do anyway:D

Jeff

Reading the responses in this thread makes me happy. I love you guys!

Seriously, forcing brewers to take a step back, try some different hops or maybe focus on malt flavors would be good. And maybe a little bad. I have a feeling a lot of the startups will be closing faster that anticipated.

OTOH, what will the growers’ response be? Planting more? New and/or heartier varieties? Giving up?

The fun isn’t over yet.

It’s highly likely that some of the start ups will ultimately fail, that’s the natural progression of a boom in an industry but I think failure will come from poor business plans or crappy beer, not the ability to procure hops.

This is one reason why the growers are not going all out in simply ramping up acreage and production. It takes too long to develop fields and product with no guarantee that demand will continue at the same rate as a constant, then they’re stuck with over supply and money lost in the investment.

Additionally, if the suggestions above are employed, what they grew as the popular hops may no longer be the most demanded hops any more.

It’s all well and good to say brewers should just try different varieties, but it’s not that simple. A small brewer here uses Perle for bittering in their German styles, and the boxes coming in are suddenly half the alpha acids as previously. Now their contract won’t supply nearly enough hops. And before you say it doesn’t matter what variety is used for bittering, their test batches having tried a selection of likely candidates for replacement have all been noticeably inferior. I would not have believed it if I hadn’t tasted the beers myself.

I’m all for trying lots of different hop varieties. I think I have 15 different ones in my freezer right now. But for a commercial brewer they have to sell a consistent product. You can’t just up and change your favor profile and not upset the market. Most of the people drinking their beer are not homebrewers, and expect the same taste each time. The brewers are now spending a fair amount of time on the phone trying to line up additional supplies.

+1. There is a startup (or two) 'round here that put out subpar beer that has nothing to do with their hop choices/availability.

Sadly this is short sighted on this particular brewer.  AA changes every year (and varies greatly with region the hop was grown in) and relying on a set amount of hops when you cant predict the AA is nuts.  As someone else said, having the flexibility of using different hops is something that people must learn to do, especially in the pro world.

I’m not suggesting that it’s that simple and I get the consistency thing, all I’m suggesting is that with some R and D and a good marketing plan it’s in the realm of possibility, especially for the smaller creative breweries that just don’t have the buying power of the larger breweries, these are the ones that are having a harder time from what I understand since the big boys have contracts locked up for several years

These blog posts give good insight into the situation.
http://blog.47hops.com/2014/06/2014-state-of-us-hop-industry.html
http://blog.47hops.com/2014/06/greedy-growers-and-dirty-dealers.html

The Second article has some great points,  But it makes you wonder how it would reflect on the secondary HBS market.  The average hop seems to sell for about 2 dollars an OZ.  Id bet the average grower is selling hops in bulk for about 2 dollars a lb.  IF the bulk price doubles or triples(which the average HBS very probably do not have the clout to access)will the prices of per ounce hops also double.  My guess is no.  They may see an increase of 20%, but the profit margin in OZ hops already seems to be quite high, even when taking in to account packaging time and cost.

I guess small regional hop yards will get some business.

+1.  Ive been buying from http://fourstarfarms.com/  They only have Whole Leaf atm but they are wonderfully fragrent.  I bought 8lbs from them last year and have already commited to buy another 20lbs of next years harvest.  Local or bust:D

+1
I would think that the smaller players would be well suited directly to the market of the HBS outlet as well as the newer, small batch players and could prove to be quite profitable.

I’m still curious though as to how the growers are looking at this playing out in the longer term, meaning beyond the typical 5-7 year contract.

While I keep seeing large numbers of proposed new breweries in the pipeline and set to open there is also the failure rate to take into account, the current double digit growth if the industry has to plateau at some point as the market gets saturated and then what? Invested acreage and infrastructure with unplanted fields? What if people turned tired of every beer tasting like grapefruit and cascade or others are no longer the "desired"hops?

Personally I’m getting tired of shopping bottles and going to festivals where every beer is the same type of pale or IPA brimming with “citrus” “fruity” aromas just because it’s what’s “in”

I disagree strongly. Perle have been 8-9% for the last decade. This year they’re suddenly 4%. How do you plan for that? Order a bunch more than you think you need? Small breweries have very tight margins. These guys have always ordered about 10% more than they forecast needing, and also trade hops heavily with the other breweries around.

It’s not so simple as saying pro brewers need to be more flexible. Having sat in some of those meetings, try telling your distributor that you’re changing a recipe. They scream bloody murder! In some states they’re entitled to compensation dollars. If you change a recipe much you really need to rename it, or the public also screams. Creating a new name is an expensive proposition.

New hop crops get tested for AA right away.  They should of known at the end of last season that the hops where gonna take a dip in AA and planned accordingly, whether its buying secondary market hops or introducing something additional for extra bitterness.  Distribution issues are a completely different problem.

Also it makes me wonder if they are getting a mix of German and US Perle,  the German Perle is notoriously lower in AA then the US Perle.  Wonder if their contract is regional specific