A Look Back at 2016

In the hop world, 2016 will likely be remembered as the year craft beer growth slowed and hop acreage didn’t. You may have seen more than a few articles proclaiming 2016 to be a record for hop acreage. It’s true that there was more hop acreage in the U.S. than ever before. What does all that extra acreage mean? The numbers in and of themselves don’t mean anything if we don’t put them in the proper context. Many brewers read about records and inferred a bumper crop was coming and that prices would collapse. That never happened. Why? There was no bumper crop. There wasn’t even an average crop.

Mother nature hit the hop industry with some nasty challenges in 2016 in the form of unseasonal heat, rain, and increased humidity. All this wreaked havoc on the crop. Early bloom, powdery and downy mildew were just a few of the problems that led to reduced yields. Hop farmers won’t be missing 2016 for the growing conditions. It was a difficult year.

From the bad old days when nobody valued hops and prices were below the cost of production (i.e., only about 12 years ago) hop growers became very efficient producers and learned to overcome any challenges that nature threw their way. They learned to manage powdery mildew, the disease that chased hops out of one growing region after another across the United States since the 1800’s. Mother Nature was no match for the hop industry. Human nature, on the other hand, still has one up on the hop industry. The only challenge growers haven’t learned to overcome is their own desire to plant more when things are going well, which ultimately leads to the collapse of the market.

We now know that American hop growers produced 87.1 million pounds in 2016. While that would literally be a mountain of hops, more than 2015 and approximately 50% more than just 5 years ago, it is nothing special. The crop could have been so much better. Average yields were down about 5%, which means at least 5 million pounds disappeared due to some bad weather … and that is the best thing that could have happened in 2016.

Despite that enormous shortfall, over 5 million pounds, which is more than most European hop producing countries produce in a good year, we don’t see any signs of shortage. That paints a potentially dark picture for the years to come if growers continue to plant more acreage in the future. The market in 2016 sent a sign that there are enough hops in the ground right now. That is what should stand out most when we look back at 2016. Time will tell if hop growers are clever enough to deal with human nature as well as they have dealt with Mother Nature.