If it’s not Wicked Weed, it’s something else, I suppose.
On the heels of a loud and wide outcry from industry professionals and drinkers over the purchase of Wicked Weed by AB InBev, the global conglomerate has offered another reason to pile on. Today, it was noted that AB InBev, post-merger with SABMiller, will use South Africa’s SAB Hop Farms with the goal, according to this memo, “to sell the hops internally to their acquired (former) craft breweries, even though they have not been able to sell all the hops as of yet.” To be clear, it seems this amount of hops is 20 metric tons, or roughly 44,100 pounds.
To put that in comparison, the US grew a reported 89 million pounds of hops in 2016.
But let’s go a step further. If I’m translating numbers correctly, the International Hop Growers Convention estimated the *entire* South African hop crop at 1.9 million pounds in 2016. It is projected to drop to 1.56 million pounds in 2017. There are 1,047 acres of hops expected to be harvested in South Africa this year, or a stone’s throw away than the acreage of *only* Cascade grown *just* in Oregon in 2016.
92% of all South African hops are set to be of the alpha variety, which we know is not as popular at the moment in the U.S., where aromatic and fruity hops reign supreme.
Is it unfortunate that American brewers won’t be able to get aroma hops like Southern Passion from South Africa or alpha hops like Southern Star? Sure. But these are varieties to play with, not with which you build a portfolio of brands.
Spoiler alert: those would be Citra, Amarillo, Mosaic and Simcoe.
The loss of South African hops is taking away a portion of the sandbox in which U.S. brewers play, but they can also log onto the Lupulin Exchange at any time to find a variety of hops for which they don’t have via contract. For further context, in a release, Willy Buholzer, global hops procurement director for AB InBev noted:
More than 90 percent of our South African-grown hops will be used in local brands Castle Lager and Castle Lite, beers we’ve committed to brewing with locally-grown ingredients. In support of the local industry, we additionally sell hops to South African craft breweries. This means that less than five percent can be allocated to other Anheuser-Busch InBev breweries outside of South Africa.
This comment carries extra weight when you consider the hoops AB InBev was forced to jump through by the South African government in order to gain approval for its merger with SAB Miller, which included a $69 million (U.S.) rand fund to support the local beer-making industry and supply chains in the country.
Yes, there is a story here in terms of new market fluctuations, but if you’re curious about the future of hop growth (and scarcity?) may I recommend giving a follow to the man who literally wrote the book on them (and his new newsletter) or poke through this collection of stories from last September.
“Don’t drink to get drunk. Drink to enjoy life.” — Jack Kerouac