Hop shortage hits brewers

MARION VAN DIJK/Fairfax NZ

On the hop: Growers are caught in a cycle of boom and bust.

NZ Hops boss Doug Donelan thinks any shortage of hops will be short-lived

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A vital ingredient in pale ale is in desperately short supply, writes Jono Galuszka.

Local brewers have been forced to cut products from their ranges due to a lack of American-grown hops, a key ingredient in the popular American pale ale style.

The problem stems from a hop glut in 2006, which led American farmers to rip out hop vines in favour of more profitable crops such as soy or grain.

But a bad season in the US and multiple warehouse fires in Yakima, Washington State, which destroyed more than $US7 million ($9m) worth of hops, sent demand soaring above supply. After the fires, larger breweries pre-paid for hop crops years in advance to guarantee supply, leaving none for smaller companies to buy on the open market.

Kapiti-based Tuatara Brewing have been forced to put off making their popular APA pale ale until 2012, but Auckland brewing company Epic Beer will arguably be the worst hit.

Epic head brewer and managing director Luke Nicholas said he has a supplier for the hops which go into his pale ale and lager, but is unable to buy any for two of his beers – Hop Zombie and Mayhem – stalling production until 2013.

Mayhem and Hop Zombie were both sold for about $10 per 500ml bottle, and the latter received rave reviews on its release this year. Having the two out of production is likely to affect Epic's profits.

"We have gone to the market [to buy hops for the beers] and said `we are prepared to pay three times the price' and there are no hops to buy," Nicholas said.

The situation now is worse than in 2006, because at least back then there were hops to buy – albeit expensive ones.

"American hops [in 2006] were $8-$10 a kilo. A year or two later, we were paying $70-100 a kilo."

Although the shortage had put some of Epic's beers to rest, Nicholas is enjoying increased demand for others.

"We have had reports from Regional Wines and Spirits [a Wellington store which sells craft beer] that our Pale Ale is being sold more since [Tuatara's] APA is gone," he said.

"It's a loss for Tuatara and a gain for us, but if you can't make Hop Zombie you can't sell it."

New Zealand Hops chief executive Doug Donelan said the shortage has not driven sales of local hop varieties higher.

"New Zealand specialty aroma types have been on quite a trajectory over the past five years, so it's not the shortage of northern hops that's driving that."

But he believes any shortage of hops will be short-lived.

"Hops can grow a crop within a year and human nature will ensure that the plantings will be increased to such a level that within a year or two there will be too many again.

"It's a cycle that any crop you treat as a commodity will fall prey to."

56. – The number of hop varieties listed on Wikipedia. Australia and NZ have 11.

- © Fairfax NZ News