Aleheads published a thorough list of comments from Chicago-area brewers on what they think about the Lagunitas announcement. The feeling is universally positive though one comment, in particular, stood out from young Pipeworks…
Again, most of that beer isn’t solely for Chicagoland. It’s intended for the entire Midwest and East Coast. However, Lagunitas has traditionally had the cheapest price points for what I consider to usually be pretty solid craft beer. It’s impossible to compete with them on bang-for-your-buck. It shouldn’t have any effect on the start-up market here though if you are bringing a solid product to market. Where these kind of rapid expansions, DFH, Lagunitas, New Belgium, Sierra Nevada, might be felt by us little guys, is the constraint on quality ingredients. And it’s substantial.
Indeed.
Though overall beer consumption is down, craft beer consumption is up 14-15% from last year. A lot of the nation’s craft breweries want those coveted hops like Citra, Amarillo and Simcoe. What happens in a few years when these breweries that are building for hundreds of thousands of barrels now, many of which produce hop-forward beers, start filling in that capacity? A large portion of 855+ breweries-in-planning will have come online and want those hops, too.
Will the suppliers be able to keep pace?
Food for thought.
There could be a squeeze on the availability of certain hops, but there are always substitutes that work like Centennial, Chinook, Cascade, Magnum, etc. Plus, new varieties are always being developed.
Hop substitutes could probably work with one-off beers and those where hops aren’t at the front of the beer. I do wonder about a brewery like Kern River that has a Citra IPA. For what it’s worth I don’t see substitutes listed for Citra & Simcoe here (not necessarily saying that they don’t exist): http://www.byo.com/resources/hops.
There’a reason Ommegang sent an email around yesterday looking for 500kg of Citra hops and didn’t just buy more Cascade and Chinook.
There are certain hops that aren’t replaceable. Citra happens to be one of them.
Here’s the solution (and it’s already happening): New hops suppliers.
One of the fastest growing industries here in Michigan, besides craft brewing, is farming. Hop farms are sprouting up near Traverse City, in Southwest MI, near Mt Pleasant and all over the place!
It’s also a dual solution, in that many large cities (like Detroit, where I live) are trying to figure out a use for vacant land following the decline in industrial manufacturing over the last 30 years. Urban farming is the biggest trend we are seeing here in Detroit, and it has a viable future. If some of that farmland is used to grow hops…bingo.
It’s a model other cities and regions should look at.
Additionally, you have brewers like Bell’s, Sierra Nevada, Rogue, etc who are beginning to grow many of their own hops and other raw materials, further adding to the “locavore” concept of craft beer.
There will be hiccups, but I think forward-thinking brewers and farmers alike can alleviate the growing pains by working together.
Sounds to me like yet another reason to start a brewery specializing in sour beers instead.
or Gruits!
Not long ago, yet before the most current breath boom there was a predictive global shortage of hops in general. Now the same is happening with particular hops due to popularity. It really does not matter if the big boys suck up all the citra hops, craft brewers being what they are will adapt much faster and brew the next thing one step ahead of the behemoths could ever hope to do. And that is what will keep small craft brewrs and the drink local scene vibrant for years to come. You can still brew a killer fresh brew with saaz that will have them standing in line all day.
I agree, BeerJon, Michigan is really taking off with its hop farms. Before long on the drive up to Traverse City, you’ll be seeing nearly as many hop farms as cherry orchards. Another avenue for brewers to take is the most local of options: get your customers to grow some at home! One of our local beer bloggers here in Northern Indiana grew a small amount of hops that was used for a beer at Paw Paw Brewery last year. It might not be much, but if your get a few of your dedicated fans to pitch in and grow some hops, it can help to alleviate shortfalls and bridge the gap, as well as building in local pride. I mean, what’s cooler than drinking a beer that you grew the hops for? This is great idea for homebrewers, too, in case at some point hop prices rise due to scarcity. I think in 10 to 15 years time, Michigan will be a huge hop supplier, maybe not on par with the Pacific Northwest, but certainly substantial.
I think suppliers should be able to keep pace, since the breweries’ expansion plans have been announced somewhat in advance. I don’t *know* this, but I suspect that more acres of Citra, Amarillo and Simcoe are probably going in this year than last. This was the case for Simcoe and Citra in 2011 (http://www.usahops.org/userfiles/file/Statistics/NASS%202011%20June%20Hop%20Acreage.pdf)
Barring a bad crop, I doubt that these hops will be significantly harder to get when Lagunitas, SN and NB mash in at their new Eastern facilities, than they are now, because the growers are anticipating (probably eagerly) the increased demand.
Thanks for the great link, Phillip.
No doubt that they will grow more of the crops but can they keep pace with demand from brewers? I’d argue that there is much more demand from harvest in 2011 to harvest in 2012 for Citra than what they grew.
I also wonder about the incentives to grow things other than hops and how that impacts supply.
Need to spend some time out in Yakima…and learn!
Adam
Yeah, that site is awesome. There’s another report (http://www.usahops.org/graphics/File/Stat%20Pack/2011%20Stat%20Pack.pdf) with a section that covers hop acerage since 2002 — you can watch it hover around 30000 until 2008, when it jumps to around 40000 for two years, then drops to back around 30000.
I can’t say that the growers will always keep up with the demand for this year’s hot hops, but there is only one surprise in the expansion news, and that’s Lagunitas Second City. They aren’t mashing in till the middle of next year, though — I don’t know what’s happening right now in the Paciffic NW, but it’s conceivable that growers could add acreage based on this in time to affect the 2013 harvest.
The other two expansions I’ve seen announced (SN and NB — I can’t find any dates for when DFH expects to have capacity in place) have been coming for a year at least, and won’t be open until 2014 at the earliest — plenty of time to get new acreage started.
Now, I don’t know that the growers *will* start new acreage — the prices in that second link tell a sad story, and your point about alternative crops is a good one — but they *could* and if hop prices aren’t too low, they probably will.
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