E-Malt.com News article: New Zealand: Brewers and hop producers hoping for minimal Covid-19 flow-on effects

As Nelson's hop industry prepares to process a bumper harvest, online and supermarket sales are keeping thirsts quenched for the region's brewers, Stuff.co.nz reported on April 13.

For McCashin's Brewery in Stoke production of its popular beer varieties has continued, albeit with some tweaks to its work environment based on government guidance.

Only human resources manager Ryan McGhee and managing director Scott McCashin remained as on-site office staff, while all the warehousing and manufacturing staff had been split up to minimise work clusters.

McGhee said the company was still coming to grips with the "unpredictable" buying habits of customers in the absence of bars, restaurants and a lack of spirits in supermarkets.

"Some had stockpiled at the start [of lockdown] so we had a bit of a run initially but demand stopped as they dipped into that stockpile, but that has increased again ahead of Easter."

McCashin's have also made an effort to keep others safe by supplying around 3000 surgical face masks to small organisations in the community.

"We got some amazing reactions from people who couldn't believe they were finally getting their hands on them, which is sad but it's good that we can help," McGhee said.

For the region's micro-breweries, the revenue lost from bar and restaurant closures was being offset in the short term by a steady stream of online and supermarket orders.

Riwaka-based Hop Federation has temporarily closed its tasting room to customers but owners Nicki and Simon Nicholas along with their three staff were still working to meet off-site beer orders going out the door.

"It's been a huge drop - not business as usual - even in regard to the way we work - there's no brewing happening mainly due to the fact we had really good stock levels, and we can brew if we need to," Nicholas said.

Sales have been steady in the two weeks with most coming from Nelson, Tasman and Canterbury.

Nicholas said the income would enable the business to "tick over" for the time being.

She was confident of an upturn once the lockdown and subsequent alert levels had been lifted.

"We're planning on staying - like most businesses we have a plan and we'll stick to that - it's just tightening the belt and cutting your cloth to suit."

"If it happened in the height of summer, it would have hurt us more - but we had good stock levels and we knew we were going into autumn and winter which is slower sales anyway."

"It'll be interesting to see what the new normal looks like, to see how quickly people get back out into that and are happy to be amongst people in bars again."

The timing of the lockdown has caused minimal strife for the only region commercially growing hops in New Zealand

Chief executive Craig Orr said the industry had been somewhat fortunate that the March 26 lockdown had occurred at the back end of the 2020 harvest.

"We literally had 10 days affected on the receiving side, which was the tail end of Nelson Sauvin - our 'big gorilla' variety - and the green bullet which is an old staple."

Orr said a bumper yield had been achieved in 2020 with a 20 per cent volume increase on last season, and gains made on three new varieties.

As another essential business permitted to operate in the coming weeks, skeleton crews were now processing bales at NZ Hops' Appleby warehouse.

Orr said the domestic market was likely to operate at a slight lag, due in part to package-enabled brewers drawing down on existing hop inventories.

However, with 80 per cent of its crop sent off-shore, Orr said the effect of Covid-19 on its United States and British markets was likely to take a hit in the months ahead.

"The US, where they use a lot more of the craft varieties, is in a bit of freefall.

"We've done some pretty sobering revisiting of our budget and there's certainly some tough headwinds ahead, that's for sure."


12 April, 2020