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4-2017

Global hop market

A local alternative to mass beer suggested by independent brewers has been successful and is now altering the global market. Beer is becoming more diversified, so transnational companies have to accept the new game rules and to switch focus to young and fast growing markets. All these processes increased the demand for aroma and bitter hop as well as their acreage expansion on two continents. However now there appeared a downward trend of alcohol consumption in the world, so even special sorts can soon turn to be sufficient. In this connection the dynamic American hop market is already facing some problems. EU hop producers have become more cautious, they are not racing to exceed the demand and look forward with more confidence, judging by the contract terms. 

Hop Market in Russia

Germany still dominates the Russian market, yet over the recent two years one has been able observe a continuous success of Czech hop suppliers. Their expansion and growing popularity of hops from the United States became the drivers of supplies growth in 2016 despite the preceding modest harvest crop in the EU, as well as the factor of relative stability in 2017. In this connection, in 2017, the ratio of the varieties continued to shift towards the aroma ones, and the supplies of Magnum hop and other alpha varieties were reduced. However, the import of bitter hop pellets is partially replaced by extracts, especially from the major beer manufacturers. Total volumes of alpha acid supplies, according to our estimation, decreased by approximately 5% and returned to the level of 2015. Barth Haas Group continues dominating the hop products market; HVG also increased its weight. At the same time, Morris Hanbury significantly reduced the supplies in 2017.

Changing tastes part of beer business

Jeff Hamilton is the president of Sprecher Brewing Co., succeeding Randy Sprecher. Sprecher Brewing saw revenue increase 10% last year vs. 2009 without increasing prices. The company has broadened its product mix to capitalize on the growing American craft beer market.
One year ago, Jeff Hamilton was named president of Sprecher Brewing Co., marking the first time in the company's history that someone other than founder Randy Sprecher held that position. Hamilton had been vice president and general manager, and assumed more of the day-to-day duties of operating the company while Sprecher, who now lives part-time in California, retained the title of chief executive officer.
Sprecher Brewing was launched in 1985. It has grown to one of Wisconsin's largest craft brewers, and is known for such brews as its Black Bavarian and Special Amber. Based in Glendale, the company also sells a line of gourmet sodas, including root beer and cream soda; condiments, such as mustard and barbecue sauce; and potato chips - a natural pairing with beer and soda. Hamilton recently sat down to discuss his first year as president of Sprecher Brewing.
Q. So what have you done in the past year?
A. "We've done a lot of exciting things in the past year. We just finished an expansion, which virtually doubles our lager capacity. We've installed new brewing kettles. And we also are putting in a canning line as we speak."
Q. Why are you installing a canning line?
A. "There are a lot of reasons. Aluminum is 75% to 80% recyclable. It's also less expensive to ship. Beyond that, aluminum is the best thing for beer. It keeps out light, which is better for maintaining the quality of the beer."
Q. Do you think people realize that aluminum cans are better for beer than glass bottles?
A. "I'm sure they don't. They're always telling you that beer tastes better out of a glass bottle. I think back when beer used to be sold in steel cans, there may have been a taste issue. So that's created a stigma."
Q. The past year has seen a lot of capital investments.
A. "It's been the biggest capital spending year since I've been here. But it's all in response to opportunities and growth. People are wanting a lot of different beer flavors from craft brewers. They're not happy with just trying one or two beers. "
Q. Have you rolled out some new products over the past year?
A. "Yes, but that's not unusual. We've launched a lot of new products over the years. Last year we started our seasonal soda line. It's a tribute to Wisconsin fruits. We have strawberry, red apple, red raspberry and blueberry.
"We also started Chameleon Brewing (an offshoot of Sprecher Brewing). We're kind of known for traditional European beers here. That's how we got started.
"Today, American beers have outclassed the European beers. So we started Chameleon as a testament to the creativity of the American brewer. Chameleon allows us to express ourselves with newer types of American beers. We introduced four new products: Hop on Top, Fire Light, Witty and Ryediculous IPA."
Q. How did your sales perform last year?
A. "We're up 10% over 2009. That's revenue growth with no price increases. We didn't think it was appropriate to raise prices during an economic downturn."
Q. Have you added to your workforce?
A. "We've always hovered at around 50 employees. We added a couple of people last year, in maintenance and for the Chameleon sales line. Much of our growth has been onsite (at the brewery). We had over 40,000 people on tours last year for the first time ever."
Q. How long have you been at Sprecher? What did you do before?
A. "I've been here six years. Before that, I was at Rockwell Automation, where I ran a software business unit."
Q. Is this your dream job?
A. "I probably never dreamed it. But now that I'm in it, it is. We have just a great place to work."
8 Mar. 2011

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