98% of U.S. Hop Crop SOLD Until 2018

Chances are you’ve never attended an International Hop Growers Convention (IHGC) meeting.  It’s not widely publicized and meetings appeal to die hard hop geeks from around the world who want to know what’s going on in the market.  There aren’t any special handshakes, passwords or mysterious symbolism, but there are some interesting traditions dating back, some say, as far as the 15th century.
During the three annual meetings of the IHGC, representatives share information from their respective countries about increases in acreage and demand and discuss market prices for different varieties.  I know … it may not sound so exciting, but if you buy and sell hops for a living, it actually is very useful and interesting information!  Hops are kind of an addiction for us … so; yes … we attend all the meetings I’m proud (and slightly embarrassed) to admit. 
The most recent meeting was in Paris last week.  A small group attended, but they represented the major hop producing countries in the world.  Cautious optimism filled the room and plenty of caveats abounded as country representatives reported what average yields “should be” in 2016.  After the drought in Europe, which resulted in some countries’ yields being down by nearly 40%, representatives were a bit hesitant to over promise on yields.
Looking at the data from afar year on year, it appears hop production is up over 20% from 2015. That’s a bit misleading though as the drought seriously affected yields.  According to the IHGC data, worldwide acreage is up about 8.5%.  Fifty-seven percent of that increase is happening in the United States, which makes sense as demand for American hops are increasing worldwide as the trend for American-style craft beer is spreading like mad.
In a nutshell, it seems everybody is planting hops.  The countries in attendance report that nearly all of those hops have been sold.  The United States reported that 98% of the anticipated crop is already sold for 2016, 2017 and 2018. The anticipated sold ahead percentage drops to a mere 80% sold ahead in 2019 and 2020 with 50% of the crop already sold for 2021.
You’re probably asking yourself, “How the heck does anybody even know what the crop in 2021 will be?”  That’s a good question.  Fortunately, I served as Chairman of the Economic Committee to the IHGC for several years, so I can tell you. The organization takes this year’s anticipated production, which is calculated using 5-year average yields, and project that number forward. Acreage is likely to continue to expand during that time so the actual percent sold ahead could be a bit lower. Demand from larger brewers however, will likely enter into the equation and could change the trajectory of the market. You can see the challenge with the data. A lot of the numbers from the IHGC are that way. They are best viewed as a guide to show the direction and velocity of the industry and the market. If you’re going to look at them, you should take them with a grain of salt, but don’t assume they are 100% correct, because they are not. That, unfortunately, deters many people from attending the meetings. 

4 thoughts on “98% of U.S. Hop Crop SOLD Until 2018

  1. Anonymous says:

    Most Hops varietals contain a complex compound that when brewed or stewed as in tea, revives the Human Anatomy's Metabolism

  2. Douglas MacKinnon - @47Hops says:

    Thanks for the comment NZHopguy! Unfortunately, there were no representatives from the Southern Hemisphere present at the meeting. When asked about the status of the crop there, none of the larger merchant groups were willing to comment on the crop.

Leave a Reply

Your email address will not be published. Required fields are marked *