USA: Hop growers set new acreage, volume and value records in 2017

U.S. hop growers set new records in acreage, volume and value in 2017 and for the first time Idaho surpassed Oregon in annual production, the Capital Press reported on December 21.

While the rate of growth of craft breweries has been slowing and inventories of hops have been increasing, the 2017 totals may not be peaks.

Acreage likely will increase slightly in 2018, more fields planted in recent years will come into production and some acres will shift from aroma into high alpha varieties at generally much higher yields, said Pete Mahony, vice president of supply chain management and purchasing for John I. Haas, a major processor and grower in Yakima.

“It’s simply difficult to slow a fast moving train. It might take a couple of years yet for the brakes to engage,” Mahony said.

Growth of craft breweries has fueled the increase of aroma variety hops in recent years but inventories have been increasing reflective of supply catching up with demand as the rate of craft brewery growth has slowed. On Sept. 1, U.S. hop stocks were 98 million pounds, up 15 percent from a year earlier.

In 2017, U.S. hop production totaled a record 104 million pounds, up 20 percent from the 2016 crop of 87.1 million pounds, according to a USDA National Agricultural Statistics report issued Dec. 19.

Acres harvested were a record 53,282, up 5 percent from the prior record of 50,857 in 2016. Value of production was a record $618 million, up 24 percent from the record high of $498 million in 2016.

Harvested acres increased 24 percent in Idaho, 3 percent in Washington and 1 percent in Oregon. U.S. yields were 1,959 pounds per acre up from 246 a year ago.

The industry anticipated a large crop given June acreage estimates and good growing conditions and ample water contributed to above average yields in most varieties, Mahony said.

Acreage in 2016 increased 17 percent and came into full production this season, boosting the crop, he said.

The 104-million-pound record surpassed No. 2 Germany which had 91 million pounds and below average yields, he said.

Washington remains the U.S. hop gorilla with 75 percent (78.6 million pounds) of production, 38,438 acres and $498 million in production value, according to the NASS report.

Idaho accounted for 13 percent (13.7 million pounds) of production, 6,993 acres and $68.7 million in value.

Oregon was 11 percent (11.9 million pounds) of production, still led Idaho in acres at 7,851 but trailed in value at $59.5 million.

“The U.S. crop was nearly all contracted at good prices still in place from the craft bull market,” Mahony said. While production costs, particularly labor, continue to rise, 2017 contract prices remained strong, he said.

A tight supply of high alpha hops resulted in good prices on high alpha on the spot market while there was virtually no spot market for some aroma varieties due to over supply, he said.

A minor shift from aroma to high alpha production is beginning to occur, he said.

Prices of some aroma varieties that are oversupplied will soften in the next round of contracting, Mahony said.

“The key in the near term will be how quickly the industry can rebalance and adjust the supply base to the changing market conditions heading our way,” he said.

Cascade, Centennial, Zeus, Simcoe, Citra and Mosaice were the six leading varieties in Washington, making up 54 percent of the crop, according to NASS.

In Idaho, Zeus, Cascade, Amarillo, Mosaic, Citra and Chinook accounted for 69 percent of production. In Oregon, Nugget, Cascade, Willamette and Citra were 53 percent of production.

22 December, 2017