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General Category => Going Pro => Topic started by: waylit on May 06, 2014, 03:21:13 PM

Title: Hop contracts and obtaining hops
Post by: waylit on May 06, 2014, 03:21:13 PM
I spoke with a rep from Hop Union last week. Breweries are contracting hops thru 2020. The popular IPA hops like Citra, Mosaic, Nelson Sauvin, Amarillo, and Simcoe are mostly contracted thru 2016. How will startup breweries be able to obtain these popular varieties?
Title: Re: Hop contracts and obtaining hops
Post by: denny on May 06, 2014, 03:22:48 PM
Either they won't or through a secondary market, paying more.
Title: Re: Hop contracts and obtaining hops
Post by: hopfenundmalz on May 06, 2014, 03:25:26 PM
One of the best takes on the rapid rise of new breweries opening was something like this.

"There are hundreds of new breweries opening or in planning with recipes designed around hops they will not be able to get."

One of the realities of the supply chain of hops.
Title: Re: Hop contracts and obtaining hops
Post by: yso191 on May 06, 2014, 03:44:45 PM
And hop supply is not static. More contracts equals more acreage.   Obviously not in an immediate sense, but where there is money to be earned...
Title: Re: Hop contracts and obtaining hops
Post by: Jeff M on May 06, 2014, 04:28:00 PM
One of the best takes on the rapid rise of new breweries opening was something like this.

"There are hundreds of new breweries opening or in planning with recipes designed around hops they will not be able to get."

One of the realities of the supply chain of hops.

Sounds to me like poor Business research and planning!
Title: Re: Hop contracts and obtaining hops
Post by: HoosierBrew on May 06, 2014, 04:31:05 PM
Also, never hurts to experiment with hops, to find out what ones not named Citra, Amarillo or Simcoe can be used to make good beer, just in case you can't get those.    ;)
Title: Re: Hop contracts and obtaining hops
Post by: majorvices on May 06, 2014, 06:33:53 PM
We got really lucky. We ended up walking into a hop contract with Hop Union through a brewery we contract brewed for who got a contract they couldn't support. Breweries coming on the scene now will have a challenging time finding some hops at reasonable prices.
Title: Re: Hop contracts and obtaining hops
Post by: boulderbrewer on May 06, 2014, 08:19:26 PM
A good reason for a homebrewer with professional aspirations to play with all the hops not just the popular ones. You have to be creative to find hops without a contract.
Title: Re: Hop contracts and obtaining hops
Post by: Thirsty_Monk on May 06, 2014, 08:22:45 PM

A good reason for a homebrewer with professional aspirations to play with all the hops not just the popular ones. You have to be creative to find hops without a contract.
Agree.

Make beer with available hops.
Do not fallow "me too" approach.


Title: Re: Hop contracts and obtaining hops
Post by: denny on May 06, 2014, 08:25:56 PM

Agree.

Make beer with available hops.
Do not fallow "me too" approach.

Yep.  A brewery I'm designing recipes for grows their own hops...but only 3 varieties!  I've got to design recipes to their specs of styles using Chinook, Magnum, and Fuggles!  Talk about a challenge!
Title: Re: Hop contracts and obtaining hops
Post by: Thirsty_Monk on May 06, 2014, 08:30:32 PM
Magnum for bittering. Chinook for American beers, fuggles for British beers.


Title: Re: Hop contracts and obtaining hops
Post by: denny on May 06, 2014, 09:18:34 PM
Magnum for bittering. Chinook for American beers, fuggles for British beers.

You'd think so, but all they want to make is an Oatmeal Brown ale, an AIPA and a IIPA.  I am not part of the business plan, only a hired gun.
Title: Re: Hop contracts and obtaining hops
Post by: Thirsty_Monk on May 06, 2014, 09:24:29 PM
I would do oatmeal brown ale more British so use Fuggles. Other two beers would fall for chinook. Do not use Magnum as finishing hops.


Title: Re: Hop contracts and obtaining hops
Post by: tschmidlin on May 07, 2014, 12:12:15 AM
But Denny, you hate fuggles!

There are beers we won't be able to make due to lack of hops.  I'm not too stressed about it, we will just make other beers.
Title: Re: Hop contracts and obtaining hops
Post by: Pawtucket Patriot on May 07, 2014, 12:53:39 AM
Supply is going to be tight on those varieties for the foreseeable future. One of the first things I did when I decided to open a brewery was sign a hop contract for all the varieties I knew I wanted. We are about to open our doors next month (knock on wood), but I contracted for hops with two brokers in December of 2012. Still, I wasn't able to get everything I wanted. I ended up buying some hard-to-find varieties on the secondary market. Yes, I paid a bit of a premium for these hops, but it depends on how important a particular variety is to your beer. For me, I had a very specific idea of what hops I wanted to use. Hopefully, it will be worth it!
Title: Re: Hop contracts and obtaining hops
Post by: reverseapachemaster on May 07, 2014, 02:18:59 PM
The hop market is really tight for certain varieties, even cascade can be tough to find on the spot market. On the other hand, there are also lots of breweries always trying to unload excess hops off their contracts. So although the fields might be contracted out that doesn't mean some of the crop won't make its way into a secondary market.
Title: Re: Hop contracts and obtaining hops
Post by: denny on May 07, 2014, 05:38:04 PM
I would do oatmeal brown ale more British so use Fuggles. Other two beers would fall for chinook. Do not use Magnum as finishing hops.

That's kinda my basic plan.  No British yeasts, though, only 1056.
Title: Re: Hop contracts and obtaining hops
Post by: denny on May 07, 2014, 05:38:49 PM
But Denny, you hate fuggles!

Yes...yes, I do....
Title: Re: Hop contracts and obtaining hops
Post by: gmac on May 07, 2014, 09:08:42 PM
I would do oatmeal brown ale more British so use Fuggles. Other two beers would fall for chinook. Do not use Magnum as finishing hops.

That's kinda my basic plan.  No British yeasts, though, only 1056.

Good luck. 
Title: Re: Hop contracts and obtaining hops
Post by: denny on May 07, 2014, 09:44:31 PM
Good luck.

Thanks, man.  It's a challenge.  At this point the oatmeal brown is tasting pretty good, despite the Fuggles!
Title: Re: Hop contracts and obtaining hops
Post by: waylit on May 07, 2014, 11:16:27 PM
Here's a good blog post on the topic...

http://odd13brewing.com/blog/2013/03/29/dont-get-your-hops-up/
Title: Re: Hop contracts and obtaining hops
Post by: phunhog on May 08, 2014, 12:28:08 AM
So I know as a homebrewer I can find the most popular hops for somewhere around 16-22 dollar a pound. Just curious as to what a brewery with a hop contract pays per pound for the popular varieties. 
Title: Re: Hop contracts and obtaining hops
Post by: Jeff M on May 08, 2014, 12:37:24 AM
So I know as a homebrewer I can find the most popular hops for somewhere around 16-22 dollar a pound. Just curious as to what a brewery with a hop contract pays per pound for the popular varieties.

Retailers usually double up at most.  if they sell them for 20 bucks id bet 12-14 with shipping etc.  Im planning worst case at 20$ a pound and if i do better, awesome.  Atleast im ready for the worst case.
Title: Re: Hop contracts and obtaining hops
Post by: Thirsty_Monk on May 08, 2014, 02:08:00 AM

I would do oatmeal brown ale more British so use Fuggles. Other two beers would fall for chinook. Do not use Magnum as finishing hops.

That's kinda my basic plan.  No British yeasts, though, only 1056.

I think that will work. If you want it frutier ferment it warmer.


Title: Re: Hop contracts and obtaining hops
Post by: hopfenundmalz on May 08, 2014, 02:17:01 AM
So I know as a homebrewer I can find the most popular hops for somewhere around 16-22 dollar a pound. Just curious as to what a brewery with a hop contract pays per pound for the popular varieties.

Retailers usually double up at most.  if they sell them for 20 bucks id bet 12-14 with shipping etc.  Im planning worst case at 20$ a pound and if i do better, awesome.  Atleast im ready for the worst case.
In Ken Grossman's book he says the hops they raise are expensive at $30 a pound, while the ones they buy on contract are 1/10 that. You do the math. One might not have the buying power of a Sierra Nevada when starting out.
Title: Re: Hop contracts and obtaining hops
Post by: a10t2 on May 08, 2014, 01:07:52 PM
Just curious as to what a brewery with a hop contract pays per pound for the popular varieties.

It depends on variety, quantity, length of contract, storage terms, etc. Could be anywhere from $3-15/lb.
Title: Re: Hop contracts and obtaining hops
Post by: troybinso on May 08, 2014, 01:44:22 PM
You can get 11lb boxes of pellet hops for between $5.00 and $10.00 a pound depending on variety. Hard to find hops just aren't available from big hop dealers unless you have contracted years in advance. Hard to find hops on the resale market are around $20 a pound for 11lb boxes.
Title: Re: Hop contracts and obtaining hops
Post by: waylit on May 08, 2014, 02:55:57 PM
Do hop contracts normally require a down payment or payment in full ?
Title: Re: Hop contracts and obtaining hops
Post by: denny on May 08, 2014, 03:14:08 PM
So I know as a homebrewer I can find the most popular hops for somewhere around 16-22 dollar a pound. Just curious as to what a brewery with a hop contract pays per pound for the popular varieties.
'


Around here, wholesale organic is $12-16/lb.  Wholesale conventional is $3-6/lb.
Title: Re: Hop contracts and obtaining hops
Post by: boulderbrewer on May 08, 2014, 04:15:24 PM
Do hop contracts normally require a down payment or payment in full ?

Not mine, but you have to buy the amount within a year.
Title: Re: Hop contracts and obtaining hops
Post by: bluesman on May 08, 2014, 04:30:46 PM
I'm finding most hops to be available on the secondary market for a bit of a premiuim price. I would have preferred to have gone the contract route earlier on in our process, but wasn't absolutely sure that we would get the brewery off the ground. Now that we're moving along at a much better pace, I'll start working on some contracts. For the time being we'll be using the secondary markets. We'll survive one way or another.
Title: Re: Hop contracts and obtaining hops
Post by: Pawtucket Patriot on May 11, 2014, 04:00:38 PM
I'm finding most hops to be available on the secondary market for a bit of a premiuim price. I would have preferred to have gone the contract route earlier on in our process, but wasn't absolutely sure that we would get the brewery off the ground. Now that we're moving along at a much better pace, I'll start working on some contracts. For the time being we'll be using the secondary markets. We'll survive one way or another.

Glad to hear things are moving ahead, Ron!  Congrats!
Title: Re: Hop contracts and obtaining hops
Post by: bluesman on May 11, 2014, 04:28:49 PM

I'm finding most hops to be available on the secondary market for a bit of a premiuim price. I would have preferred to have gone the contract route earlier on in our process, but wasn't absolutely sure that we would get the brewery off the ground. Now that we're moving along at a much better pace, I'll start working on some contracts. For the time being we'll be using the secondary markets. We'll survive one way or another.

Glad to hear things are moving ahead, Ron!  Congrats!
Thanks...and best of luck to you too!