The 2015 American hop crop — yes, the one that won’t be harvested until next August and September — is basically sold out.
That does not mean homebrewers or new breweries or operating breweries that didn’t plan ahead won’t be able to buy hops. It means that the hops, including new plantings, that farmers in the Northwest expect to harvest are spoken for. In most cases they are committed to breweries that have contracts, but some remain in the control of brokers.
And it means that brewers, particularly homebrewers, who know they are going to want particular varieties during the course of the year should buy then when a chance arises. Pellets stored at 26° F in nitrogen-flushed oxygen and light barrier bags will retain their aroma and alpha for years.
Pete Mahony, Director of Supply Chain Management and Purchasing at John I. Haas, gave brewers the news, which really shouldn’t have been news to them, Friday during a webinar for Masters Brewers Association of the Americas members. Just a few of the highlights follow, because there’s going to be plenty of hops news to write about in the next week. I’m headed to the American Hop Convention outside of San Diego.
1) Germany has returned to its traditional position as the world’s largest hop producer, in part because yields exceeded expectations. Although American farmers grew hops on about 8 percent more acres production was up only 2.5 percent, 3.5 percent below projections. (It is possible the 2015 crop could come in above projections, which would make more hops available post harvest.)
2) The shift from high alpha varieties to what are called aroma varieties continues. About 1,700 acres of high alpha varieties came out of the ground in 2014, and 4,900 of aroma went in. This matters because . . .
3) The most popular varieties tend to mature in basically the same several days, which puts additional strain on infrastructure under pressure.
4) There are now more farmers outside the Northwest states of Washingtown, Oregon, and Idaho growing hops than there are in those three states. What that means going forward is not at all clear. There are probably more than 100 growers in North Carolina alone, compared to 71 farming entities (those may include multiple farms) in the Northwest. But all of those farmers together don’t produce as many pounds of hops as some Northwest farms harvest in a single day.
5) Farmers in the Northwest will grow hops on an additional 4,000 to 5,000 acres this year, boosting acres to close to 43,000 (with an additional 1,000-plus acres elsewhere).
6) Hop prices are going up. We aren’t talking $30 a pound for Cascade hops, but infrastructure is expensive (an investment of between $20 to $30 million to start a 500-acre hop ranch from scratch).
I wrote about the shifts in production and pressure on infrastructure in two stores of Beer Advocate magazine (in November and the current, January, issue). Sorry, no link, but you can subscribe to the digital version of the magazine.
The one part that stood out to me was the labor issue. My understanding of the presentation was they are having a difficult time to get the labor in the PNW to complete harvests now. Additional growth in the area may be limited even if they are ready to make the other areas investment in the fields the farmers still wouldn’t have the extra workers to get the yield from the harvest.
Much of that is a matter of wages. Right now, you can make more picking apples, for instance. Another reason we are going to see higher hop prices.
Stan, do you have any idea how many acres of hops are in cultivation outside the Northwest?
Relatedly, what’s the infrastructure for getting those hops to market? Does it exist? Are they essentially boutique growers producing such small quantities that those hops don’t get into the regular pipeline? What does that look like going forward?
(You don’t have to answer any of these; they’re just the thoughts that float through my mind after seeing your stats.)
Pete threw out the number 1,200, and that’s going to be larger in 2015.
As to the other questions, rather than half answers now I’ll wait until after the convention. I know it varies widely. Pretty good infrastructure in Michigan, for instance.