24. 02. 2010: Ein Appell aus Amerika an die Hallertau (englisch)
Hop growers have one final opportunity to control their destiny for the next decade. Growers must act in 2010, however, or they will quickly lose that opportunity. It should not be news to anybody that there are too many kilos of alpha acid in production now. With Herkules in Germany and CTZ in America, the surplus inventory in 2010 plus the accumulated surpluses from 08 and 09 will approach an entire year’s worth of world brewery demand. Imagine the effect that will have on prices going forward! “But my hops are contracted” the average grower will reply. True, but you must see the bigger picture if you think this is all that matters. There are two options. Growers can insist on receiving contracted prices until the contracts run out. At that time there will be NO market for those hops. Or, growers can cut production, ask their merchants to get paid to not grow those hops or to reduce the contract size. The latter option will enable growers to receive fair prices now and well into the future.
This situation exists because the contracted volumes of hops alone will create an overwhelming surplus. This says nothing for the uncontracted hops still being produced. The temptation, of course, is to blame “the other guy”, in this case, the Americans. They are an easy target, with all the acreage they planted the past two years. That is true, but the massive increases in Herkules in the past 3 years have contributed equally to the current oversupply problem. This is a common problem, which requires a common solution with everybody contributing.
Americans are already removing significant acreage in 2010. Estimates are that already over 2000 hectares are being removed. Trellis is being removed now. German growers must do the same! If Germany and America each cut their alpha production by 3000 hectares, the world hop market will be very close to balance once again. Without a corresponding cut from Germany, the American acreage reduction will have no effect on world market prices. If German growers do not also cut acreage severely in 2010, they will have the burden of being the leading alpha producer. Market share is worthless when you lose money on every kilo of hops produced. Every Euro of profit made on contracts today will be lost in the free market in the future if no action is taken.
There remains little time for finger pointing or rivalries. The time to act is now. The goal is clear. Never before have hop growers acted in unity, but never before has there been so much to gain. Let this be the first time for unity. Every grower must do what he can to help fix the problem, to align hop supply and hop demand. If nothing is done, the fate of the hop market for the next decade is certain. Talk to your merchant today!
Douglas MacKinnon www.twitter.com/darbagroup