Hop Contracts Have Microbreweries Paying Last Year's High Prices

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Story Published: Nov 1, 2009 at 8:56 PM PDT

By Sade Malloy

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YAKIMA -- The Yakima Valley is a hot place for hops making up 70% of the U.S. market. But business has been rocky going from not enough hops last year to too many this year. It's a rollercoaster ride that's got local microbreweries paying more for hops than what they're worth.

The hop shortage and high prices of last year are over but continue to hurt local brewers.

Chris Miller is the head brewer of Snipes Mountain Microbrewery. He'll make up to 1,000 barrels of beer this year but instead of paying 6 grand for his hops he's paying nearly double that.

The shortage of last year scared a lot of brewers into contracts. So despite this year's excessive amount of hops driving down the price they're paying 2008 rates.

"I'm local and I'm still in a contract in between $16-$18 a pound and I have another year on a contract," says Chris Miller, Snipes Mountain Microbrewery.

Miller says he's paying around 10 dollars more per pound than what hops are going for right now. It's forced him to bump up his prices 10-15 cents per pint and change his recipes reducing his hop variety by more than half.

"Lots of breweries are selling their hop reserves to other breweries," says Chad Roberts, the Beer Shoppe.

The shortage hurt everybody and the folks who sell local microbrews saw it all first hand. Between the price of malt and hops some bottles prices were going through the roof.

"We had a beer go up like $3 per bottle in one week," says Roberts.

The hops might be overflowing now but for breweries stuck in contracts the problems of the 2008 shortage continue into 2009. Something that turns this glass from half full to half empty.

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