Author Topic: Hop Glut  (Read 359 times)

Offline Wilbur

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Hop Glut
« on: March 27, 2018, 02:31:05 AM »
A nice Beervana post about the hop glut:
https://www.beervanablog.com/beervana/2018/3/22/the-warehouses-are-full-of-way-too-many-hops

Here's the production chart (USDA via Capital Press):


Hop production was up 20%. Seems especially poorly timed, as more places are closing. We're still up overall, with over 6000 breweries in the US. Maybe we'll see some changes in the contracting.

https://www.brewersassociation.org/statistics/number-of-breweries/
http://usda.mannlib.cornell.edu/usda/current/hops/hops-12-19-2017.pdf
https://www.brewersassociation.org/press-releases/2017-craft-beer-review/

My questions are: Will small producers in Michigan, NY, IL, etc. find a niche and stay in business? Or will they lose out to larger farms in the Pacific NW? My thought is they'll be find as long as they're on the smaller side.

I'm interested to see how if this affects LHBS as well. If online shops are selling hops at $6-12/lb, it's hard to by local.

I know the news is still in the dark on this, plenty of places (and farms) getting in the hop business.

Offline Robert

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Re: Hop Glut
« Reply #1 on: March 27, 2018, 02:53:10 AM »
True about buying at LHBS.  I can pay 2 day shipping and still pay half what I'd pay walking out of LHBS. But LHBS now carries hops from one local grower. The question I have about their long term success is less market than actual growing.  I have tried growing hops here in NE Ohio.   We have, at our latitude, suboptimal daylight, late springs, and worst of all particular pests:  every year, the Japanese beetles stripped the bines just as they were putting out cones.  Advantage PNW. Growers around the Great Lakes are not likely to be expanding beyond a very local market, as a novelty product, I expect.
Rob
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Offline hopfenundmalz

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Re: Hop Glut
« Reply #2 on: March 27, 2018, 03:38:45 AM »
Old news to those that have been following the hop market. Boom and bust.

The local growers in MI have carved out a following with local brewers. Why? The hops are fresh, and have a very good aroma (terroir). I don’t see the total acres getting too big, for the pests that Robert lists, and since it is more humid, the molds and mildews.
« Last Edit: March 27, 2018, 02:11:46 PM by hopfenundmalz »
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Offline yso191

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Re: Hop Glut
« Reply #3 on: March 27, 2018, 05:22:47 AM »
Old news to those that have been following the hop market. Boom and bust.

The local growers in MI have carved out a following with local brewers. Why? The hops are fresh, and have a very good aroma (terroir). I don’t see the total acres getting too big, for the pests that Robert lists, and since it is more humid the molds and mildews.

Terroir is a big deal.  A given variety can taste dramatically different in another location.
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Offline reverseapachemaster

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Re: Hop Glut
« Reply #4 on: March 27, 2018, 02:45:16 PM »
I'd be curious to know the breakdown of varieties held which might tell more about what is going on then bare numbers. A large volume of tropical hops just tells me there's a lot of hop inventory going into IPAs and brewers are holding a large inventory to ensure they always have enough. In that case, there's no problem. OTOH, if that supply is full of hops nobody wants then that's inventory that will eventually get liquidated and likely represents hop fields growing product nobody wants.
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Offline hopfenundmalz

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Re: Hop Glut
« Reply #5 on: March 27, 2018, 02:58:01 PM »
I'd be curious to know the breakdown of varieties held which might tell more about what is going on then bare numbers. A large volume of tropical hops just tells me there's a lot of hop inventory going into IPAs and brewers are holding a large inventory to ensure they always have enough. In that case, there's no problem. OTOH, if that supply is full of hops nobody wants then that's inventory that will eventually get liquidated and likely represents hop fields growing product nobody wants.

This exchange is a slice of the trading that is going on. There are other places hops are traded or brokered.
https://lupulinexchange.com
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Offline Robert

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Re: Hop Glut
« Reply #6 on: March 27, 2018, 02:59:30 PM »
Last report I looked at Super Galena, Zeus and Nugget are still the highest production by a good margin IIRC.  If those are also most held, that's  because they can always be sold later when the price goes up to make extract for Asian brewers and such, the largest market by far anyway. More a business practice than a real glut.
Rob
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Offline hopfenundmalz

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Re: Hop Glut
« Reply #7 on: March 27, 2018, 03:25:53 PM »
Last report I looked at Super Galena, Zeus and Nugget are still the highest production by a good margin IIRC.  If those are also most held, that's  because they can always be sold later when the price goes up to make extract for Asian brewers and such, the largest market by far anyway. More a business practice than a real glut.
Alpha was surpassed by Aroma varieties some years back. It looks like the highest production in LBS is Cascade, Centennial, then Zeus. Simcoe and Citra are not far behind. Nugget and Super Galena are way down.

Look at the bottom table.
https://www.usahops.org/img/blog_pdf/102.pdf
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Offline Robert

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Re: Hop Glut
« Reply #8 on: March 27, 2018, 05:43:22 PM »
Thanks, that's a year newer than I last looked at.  But it still looks like the alphas are still the biggest individual varieties, though aroma in the aggregate far surpasses alpha.  (And some we think of as aroma were bred for alpha, so could go that way!) So I still wonder if alpha is being stored.  And with the world market demanding a lot of alpha and not focused on aroma, shouldn't there actually be more grown?  I mean, one reason we have the barley varieties we have to live with is that it's all driven by the demands of Chinese high gravity, high adjunct brewers.  Maybe the Aussies are picking up the alpha. Maybe there's a positive (for craft brewers) effect from consolidation of the mega companies -- US growers have lost contracts to growers in Australia,  Europe,  Africa, etc and really are responding to craft. But is craft sufficient to support the industry?
Rob
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Offline hopfenundmalz

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Re: Hop Glut
« Reply #9 on: March 27, 2018, 07:01:12 PM »
Surplus hops can be turned into extract. When in was at YCH there was a very large stack of 55 gallon drums that were headed to Heineken.

Extract is shelf stable, but it can take years to work through the surplus stockpile.
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Offline Wilbur

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Re: Hop Glut
« Reply #10 on: March 27, 2018, 07:44:34 PM »
I mean, one reason we have the barley varieties we have to live with is that it's all driven by the demands of Chinese high gravity, high adjunct brewers.

I hadn't heard that, I thought it was mostly to meet malting characteristics not related to flavor. Any more info on this? I know Briess tried to introduce Synergy variety pilsner malt, but I don't think it caught on. I can't seem to find it anywhere anymore.

Offline Robert

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Re: Hop Glut
« Reply #11 on: March 27, 2018, 08:10:38 PM »
It's been covered in a lot of literature over the years.  Asia has long been by far the biggest market for US malting barley, so whatever the agronomic considerations, the malting characteristics selected for are low flavor and favorability for those type processes. Here's an interesting white paper from the BA that bridges the topic of the hop industry's responsiveness to craft and the hope barley might do so.   But as yet there's no similar economic incentive to the barley producers.

https://drive.google.com/file/d/1U5x5HMKCoFW-Bf4TnKVqA0C6cI9R89LD/view?usp=drivesdk
« Last Edit: March 27, 2018, 08:12:11 PM by Robert »
Rob
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