The Atlantic Northeast Blossoms as Beer Supply Producer Once More

Before Prohibition crippled the nation’s brewing supply industry, Maine and other areas of the Atlantic Northeast were widely regarded as the best locations from which to source hops and other ingredients for beer. However, between natural predations (aphids for instance) and manmade disasters (Prohibition), what was once a thriving industry fell apart. 15 or 20 years ago, you would have been hard pressed to find a hop yard operating in the area. Today, that’s changing and it’s a good thing too. With the incredible growth in the craft brewing industry, there is a massive demand for primary ingredients like hops and grains. Small breweries all over the nation can benefit from the burgeoning growth in the Northeast. 

What’s Happening?

The most notable change in the equation is the growing number of hops yards operating. The climate throughout the Northeast is pretty much ideal for hops, and small hops producers are beginning to pop up throughout the area. However, there are some problems here. 

The most significant problem that hops producers need to overcome is the prohibitive cost of harvesting hops. Developing a single acre of land for hops production and harvesting can cost in excess of $10,000. The produce from that one acre might not even be enough to supply a single brewery with hops for their needs. 

So, the problem is one of sufficient hops growth and prohibitive costs. Harvesting is also difficult, as most small producers have to harvest and dry their hops by hand. There’s another problematic situation too – the process of pelletizing hops is expensive and out of reach for many local producers. Pelletized hops are stable for a very long time, which allows brewers to produce their beer all year long, rather than working with fresh hops during specific times of year. Small hops producers unable to pelletize their product are forced to work with breweries capable (or interested) in using whole-leaf hops in either dried or fresh form. 

As you can see, there is a lacking infrastructure even in supply development, much less in delivery and sufficient quantities to sustain numerous small breweries. There’s an answer to the conundrum, though – hops processing companies are beginning to be seen, though they’re not particularly widespread as yet. These companies offer hops processing, as well as other forms of assistance to farmers, such as training and assistance in getting started growing hops.

It’s Not Only Hops

The Northeast boasts more than just a great climate for hops. It’s also home to a wide variety of grain growers from wheat to barley and rye. However, there’s another holdup here that limits the viability of locally sourced grains for brewers.

The supply problems facing local breweries are not confined to hops alone, particularly for breweries looking to source all of their ingredients locally. There’s a breakdown in the supply chain that is causing issues. Namely, there are very few malting facilities out there capable of working with small batch suppliers. To be used in brewing, grain has to be malted. The malting process is essential to creating a good batch of beer. Without malting, the starches found in grain cannot be transformed into sugars, and won’t give yeast anything to ferment. 

How does malting work? The process takes place in a malt house, and requires that the grains first be germinated. Once the grains begin to sprout, they’re dried with air, heat and smoke. Both floor malting and pneumatic malting process are used today, though floor malting is not widespread and can produce only small batches. It was largely the shift away from floor malting that gave rise to the large-scale malt houses of today. 

The kilning (drying) process is what’s responsible for giving beer its color. Pale and crystal malts create light colored beer, while chocolate and black malts produce much darker varieties. There are malt houses in the Northeast, but most are very large facilities designed to help supply Big Beer with the malted grain necessary for their products. Very few malt houses are capable of working with small batches, which hurts both local growers and local brewers.

Nevertheless, there is change coming. Craft malt houses (those specializing in small batches specifically for local growers and brewers) are beginning to make a reappearance in the area. As yet, the process is slow with very few companies with viable operations up and running. 

Opportunities Abound

While these problems are frustrating and expensive for local growers and brewers, that doesn’t mean that there is nothing good to come from the situation. With the lack of viable malt houses with which local brewers can work and with the limited number of hops growers currently operating in the Northeast, it means that there are plenty of opportunities for others to step into the craft malting and hops growing industry.

Why might someone consider this? One obvious reason is that this is a great option for those passionate about craft beer and reclaiming the brewing industry from the hands of super-big companies. In fact, most of those growers and malting firms in operation today were started by home brewers! While the initial outlay can be expensive and the processes can be time consuming, there is plenty of room in both sectors of the industry for new companies. 

Interestingly, many existing companies welcome new startups in the same niche. There is so much need that there is little competition and most owner/operators take the view that the more operations there are in existence, the more successful the industry can be as a whole. It’s a unique situation where business owners are welcoming of newcomers and competitors, seeing them as a sign of good things to come in the not so distant future. 

Of course, growing hops and malting grain are not business options for everyone. However, for those looking to help the craft beer industry flourish, help local economies stabilize and blossom, and to really make a difference, there are few options that can compare. 

Posted on August 29, 2011 and filed under The Business of Beer.