Tag Archives: american hops

Our Recent Visit to the US Hop Capital: Portland, Oregon

The team has just come back from a week in the mighty United States – visiting customers and suppliers as well as learning about US hop growing and visiting the US Hop Convention in Portland, Oregon. We found out a lot of interesting facts and knowledge relating specifically to the US hop market, so if you are into your hops like us, read on.

Demand Continues to Grow for US Aroma Varieties

  • Craft beer growth as defined by the Brewers’ Association (loosely the US equivalent of SIBA) remains steady at around 4%. This is a big slowdown from the mid-teen growth of a few years ago, but remains positive. Underlying growth may be higher – brewers which have been acquired by the big lager producers are growing significantly faster than this and aren’t included in the BA numbers.
  • The growth in average craft beer hopping rates has accelerated again to 1.2KG / barrel from 1.1KG last year. This is across all beer styles – some NEIPAs are well over 3KG / barrel! While we may have passed ‘peak haze’ there is still a lot of this style being enjoyed.
  • On a variety-by-variety basis, a weak baby crop in 2019, combined with continued high demand from craft breweries has pushed certain varieties such as Citra into short supply. Growers and merchants are reacting – Citra acreage was up by 35% in 2019 and more is expected to be planted for the 2020 harvest. It may well be that this is enough to quench demand that variety in the medium term, but it will remain hard to find at least until the 2020 harvest has become available. Despite this new planting, the market for newer NEIPA-friendly hops such as Strata, El Dorado and Ekuanot seems to have tightened in recent months. Back in early 2018 it was possible to still buy the most sought after varieties at reasonable prices on the spot market. It is now becoming increasingly difficult to contract for premium varieties for the 2020 crop in advance.

Further Acreage is Needed to Meet Demand

  • Brook House Hops’ involvement in the ‘alpha’ or bittering hop market is limited. Existing inventory (or stocks) is limited, which has pushed up spot prices, however the market is unbalanced because there is sufficient acreage in the ground currently to satisfy brewer demand. The current shortage is largely caused by a series of poor harvests in the Hallertau which is now the world’s largest producer of hops. Northern Bavaria seems to be disproportionately exposed to climate change and it is possible that these weak yields are the ’new normal’. If this is the case, then more alpha from other growing regions may be needed.
  • Supply of land and labour is beginning to crimp the ability of US growers to expand into further acreage:
    • Inflation – pay is up to $16 / hour for casual workers, and it seems probable that an exemption for overtime which has existed for agricultural workers in Washington state will soon be eliminated. This could push effective pay up by another 20-25%.
    • Land availability is poor – particularly near existing harvesting facilities. Many of the most popular newer varieties also have relatively short picking windows – existing picking facilities are running at maximum capacity during these picking windows. This means that existing growers are going to have to invest in whole new farms or ranches in order to expand. A modern picking facility with 600 acres of land (roughly one facilities’ harvest capacity), and operating costs getting plants established costs north of $20 million. This is not a trivial investment – especially given the historic cyclicality of the hop industry.
  • Besides labour, the main headache for US growers is pesticide and fungicide availability. Different countries have different environmental and food-safety standards. Importers are able to specify certain ‘maximum residue levels’ or MRLs on importer products. MRL alignment is becoming a bigger and bigger issue. Because of their growth pattern (perennial below ground, annual above ground), hops are almost uniquely vulnerable to pests and diseases.

Growers like us work extremely hard to minimise fungicide and pesticide usage, but it is exceedingly difficult to grow hops 100% organically. Governments in Europe are continuously tightening residue regulations too and US growers are subject to these regulations if they want to export their crops globally.  The good news is that the British Hop Association continues to do valuable work aligning these regulations globally and the demand is strong, seeing the market thrive and evolve each season.

Yakima Valley Research Visit – November 2019

Several members of the Brook House Hops team spent a few weeks on the road in the US during November. We try really hard to differentiate on quality, which means we buy hops pelletised at the source in Yakima and invest in selection. Hopefully this means that our customers can brew tasty, fresh beer. We also use the opportunity to talk to growers in the US about changes in best agrononmic practice: how they grow their hops to maximise aroma.

Flying in to Washington State

The trip also took in a number of customers and potential customers in all parts of the US: we visited craft breweries producing under 1,000 barrels per year, up to over 500,000. Some were long-established, others hadn’t yet started brewing.  Some were fiercely independent – others were using the distribution and financial firepower of bigger brewing groups to get their beer into the hands of more people. They were united by a love for beer, and, most importantly, for good beer. We were honoured to get time with some of the most exciting brewers in the business.

Entering Yakima Valley

So what did we learn about?

Firstly, NEIPAs (New England IPAs) are certainly still being brewed, but they are perhaps no longer seen as the new-new thing. Instead brewers are moving a bit back to the west. They are still doing a lot of dry hopping, but this is complemented by some bitterness early-on in the boil – not to proper San-Diego levels – but the beers have more of a kick than recent juice bombs.

Other styles which are increasing in popularity include sours, low calorie beer and low alcohol beers. All of these are trends are also travelling across the Atlantic. One difference in the US is the increasing popularity of hard-seltzers. These aren’t strictly beer – defined as simply ‘carbonated alcoholic beverages’ – but several of the brewers we met are seeing a lot of growth in this category.

Brewers are also trying to broaden the range of hops which they use. Citra and Mosaic remain the mainstays of IPAs, but brewers are experimenting more and more with newer hops such as Strata, Sabro and Idaho 7, as well as slightly longer-established varieties like Cashmere, Vic Secret and El Dorado. There was a bit of nervousness about access – several of these hops are proprietary.

What does this mean for UK hop demand?

There are two big sources of demand which we saw. Firstly brewers are producing more and more beers in a year, in more and more styles. Seasonal, Christmas, English-style ales are certainly a thing and seem to be a way that the passing of the seasons are marked in more northern states.

Secondly, several brewers are trying to differentiate their core IPAs / DIPAs with the addition of UK hops. This is for a warm aftertaste to linger after the initial hit from new world hops. Several brewers are also experimenting with new hops such as Jester and Olicana – newer hops from the public program such as Endeavour and Ernest don’t seem to have travelled as far.

All in all it was an informative visit and one we really enjoyed! We had some great beers at Single Hill Brewing and took in the culture and spirit. We love getting out there and meeting hop farmers around the world and learning about the trends in the worldwide brewing industry. Even though the harvest had been and gone, the land was vast and beautiful in a very peaceful way.

Single Hill Brewing

Single Hill Brewing