According to the latest crop report by Barth Haas, a leading global hop product supplier, this year’s hop crop in Germany is expected to be 20.4% below last year’s 47,862 tons.
Growing conditions in Europe have been characterized by above average temperatures through most of the growing season and below average precipitation. The official crop estimate for Germany is showing a yield that is 18% below what would be expected from a ‘normal crop’.
While the German crop is estimated to be short by 18% vs. a normal crop, it is down by 20.4% compared to crop 2021.
The early maturing varieties of Hallertau Mittelfrüh, Northern Brewer, Hall. Tradition and Perle have been particularly affected and will yield poorly. Rainfalls towards the end of August are giving hope for the later maturing varieties that still have time to recover.
Early alpha acid screening indicates, as can be expected, that alpha acid levels will also be below their respective long-term average.
The other European growing areas have seen similar conditions and crop expectations are a mixed bag compared to 2021. After a record crop in 2021 the Czech Republic is in store for a very poor crop this year.
What all of this means for the markets is very hard to gauge. There is certainly supply from previous crops that will help to mitigate the shortfall, but these inventories are not necessarily of the varieties that are most needed.
The report points out that many brewers are reporting very good beer production volumes for the first half of 2022 as the on-premise business is back in full swing. Some have even exceeded their output levels of the first six months of 2019. There is, therefore, a generally strong demand across the globe.
The global supplier believes there is enough supply available to satisfy demand, but it will require the cooperation and flexibility from brewers with regards to crop year and varieties.
The 2022 crop will also present an opportunity to make corrections to over-contracted forward positions. Finding the right price point for every variety in the spot market will prove tricky in view of a short crop 2022 in combination with inventories from previous crops at very variable levels.
What is certain is that forward prices will be higher than in the past. Growers are facing significant cost increases, much higher than general inflation, and will not be able to operate at historic price levels. Barth Haas is encouraging brewers to embrace modern varieties that are better suited to the changing climate and provide more stable yields than the well-known workhorses of the past.