Harvesting New Opportunities in the Craft Beer Industry
As seen in the Tried & True Winter 2021 issue
Hops farmers and the craft beer industry are in a relationship, and it appears to be a long-term commitment.
Within our global economy, proximity partnerships have always been an agribusiness mainstay. Remaining hyperlocal doesn’t apply just to restaurateurs seeking freshly-sourced ingredients for an authentic farm-to-table experience. The same benefits apply to brewers desiring the only best ingredients for their craft beers. When it comes to hops—a key component that keeps beer fresher longer and adds to the aroma and taste—the demand is high for this crop’s accessibility within a brew master’s zip code. When the best of locally-grown ingredients meets neighborhood crafters, economies flourish, microbreweries produce quality products and beer lovers keep buying.
For many, enjoying beer has become an experience. Grabbing a beer and popping the tab isn’t what it used to be. Over the past 15 years, the momentum of brewing locally has surged with 85% of Americans living within 10 miles of their favorite brewery.
A BRIEF HISTORY
In 1648, a 45-acre Massachusetts hops provider ferried the product to a bay area settlement within the state for brewing. For 150 years, Massachusetts was the top-hops supplier until other areas of New England embraced the opportunity. By the mid-1800s, New York held the most extensive hops acreage. The eastern reign lasted decades until the Pacific Coast became a hops production dynasty. The temperate weather, fertile soil and plentiful access to natural irrigation sources in Oregon, Washington and California were perfect fertile ground. By 1990, Pacific Northwest hops farms dominated the industry.
Today, hops production isn’t limited to the Upper West Coast. Although 40% are grown in the northwest, opportunity abounds with smaller-scale farms meeting many local brewmasters’ needs. There are challenges to growing the crop in Midwestern fields: invasive bugs, plant disease, fickle weather and always having the right drainage in place for times of drought or plenty. Compared to other regions, the Midwest’s short winter days and unpredictable summer weather can make hops farming a challenge yet not impossible. Farmers from Nebraska to Ohio know how to grow—period—and they’re helping regional brewers challenge craft beer perceptions and palettes.
THE BUSINESS SIDE OF BEER
Despite obstacles, those who “grow beer” see it as a passion and a pocketbook decision. According to data from the U.S. Census of Agriculture and Reference, the number of craft breweries more than quadrupled from 2007 to 2017, increasing from 992 to over 4,000. By 2019, that number had more than doubled to 8,275. Craft breweries are independent operations producing 6 million barrels or less annually. As a whole, this small but mighty industry filled 26,347,950 barrels of craft beer, totaling revenues near $29.3 billion; a dollar amount that turns heads towards opportunity.
The ability to create unique combinations makes for diverse menus. That’s control many crafters love having. From jalapeños to sweet potatoes, the connection brewers have to their products gives them total liberty and freedom to experiment in small batches. They aren’t bound by a recipe book or board room to make space for new flavors on the menu. Although the more massive, mainstay beer makers claim 16% of the market, they have a signature style and loyal following all their own.
It’s not easy launching new crops, and hops is no exception. For those considering replacing or rotating it with corn or soybeans, experts say the flower isn’t as agile in diverse elements. The amount of water and nutrients hops relies upon to flourish is significant and that’s where having the right pipe installed comes into play. Wet root systems and hops are not a great agricultural combination. Before you plant, installing drainage systems is recommended to wisk unnecessary water away from the field. Growers can also utilize grass waterways and raised plant beds to assist in crop success.
Due to crop fragility, hail, strong winds and torrential rains can all damage hop flowers. Along with startup investment costs, harvesting, drying and processing can add up. However, demand continues driving the desire to grow hops. With the number of craft brewhouses increasing, this cash crop offers an alternative to growers, supplements their income and gives them a beer business “in.”
Beyond location and Mother Nature, a few other challenges remain. Small farms don’t have the luxury of dabbling in a little of this and a little of that when sowing their fields. It takes planning to procure the right produce, harvest the maximum yields and remain profitable. Some hops farms are becoming a one-stop-shop with an umbrella of businesses underneath them. Weighing the cost of purchase orders from variant brewers, many farmers consider what it would take to set up a farm-to-bottle operation: fields to farm, brewing facilities and a taproom to serve clientele. For some, the necessity and ingenuity stemmed from the “2008 Hops Crisis.” A shortage of hops and the climate’s havoc meant headaches for microbrewers who couldn’t gain access to it. The big players had first dibs—pick of the crop, if you will—while smaller brewers were left choosing between little or nothing at all. For many, that year was a game-changer, and they decided to secure all aspects in-house as growers, producers, bottlers and local taprooms.
THE BREWING SIDE OF BUSINESS
Pick any city, and you’ll find local brewpubs are not an anomaly. This has forced brewers and growers to distinguish themselves among the many. Both parties had to look no further than Wine Country as the model for inspiration.
People have travelled to Napa Valley for decades. They understand the magic in a glass sourced from the land they’re standing on. Beer aficionados can now do the same. Enjoy a regionally produced beer that reflects the best of the area’s ingredients, energy and people serving it. Licensed, farm-based breweries grow, create and serve beer on-site, providing an insider experience in an industry with a lot of competition for connoisseurs. Like a decade’s old family winery in Sonoma, yet beer fills the pilsners and flight glasses rather than a table white or red blend presented in long-stemmed glasses. Beer tasting rooms allow visitors to learn about its creation and history. They can also reach out and touch the hops growing in the field before their eyes—a magical experience.
Another perk to experiencing beers crafted in different regions is that each area is home to varying microbes. This is one reason why growing ingredients for seasonal brews, or “special runs,” is perfect. They reflect the region, time of year and local flavors—literally. No two beers may be reproduced perfectly, and that’s part of the charm. “What’s in season?” becomes more than just a question. It shapes the entire creation process and flavor profile of a brew.
Farmers and independent brewers will continue influencing the market together. The partnership of growing and brewing local means intermediaries are at a minimum and simple planning happens over an IPA or cup of coffee. Both parties can explore the edges of craft beer ingenuity while relying heavily on the expertise of each other. There’s more to it than simply finding a reliable supplier or a customer who pays their product invoices in a timely manner. The trust that forms is critical. Growers and brewers count on, encourage and have a stake in their partner’s success. Fratco sees our relationships with employees and contractors in the same light. Long-term relationships build future opportunities, and we’re grateful for each and every one of our customers who’ve trusted us to continue producing the best pipe in the business, and our employees who make it happen.
Agriculture uses 80% of all water in the United States. That’s why customers will continue installing pipe for long-term drainage solutions in tandem with water-saving practices. From creating eco-friendly water-routing systems to optimizing the time between planting and harvesting, Fratco knows agribusinesses are looking for ways to respect water sustainability while maintaining profitability. When customers are ready to put our pipe to work, we’re here to help!