For anyone wondering how AB InBev acquiring craft breweries effects the brewers, suppliers, growers and consumers of the market, here’s an example of the things that many craft brewers are scared of…
To set the stage, we purchased a few hundred lbs of South African hops from a small hop distributor that was dealing with some of the small SA farms/growers. The farms were under the umbrella of SAB which was recently acquired in the merger of AB/Miller Coors a little while ago. We were super excited to work with these hops as they were from a new growing region with new varietals and hence had new unique flavor profiles, also, the business we purchased them from was a small boutique hop shop that will be losing a huge chunk of what they work with to maintain their business. Anyway. Here’s what we received via email today:
Along with the news late last week of ABI buying Wicked Weed, I was informed by SAB Hop Farms (part of ABI’s purchase of SAB-Miller) that ABI are commandeering all the hops that were to be allocated for distribution to North American craft brewers. The goal is to sell the hops internally to their acquired (former) craft breweries, even though they have not been able to sell all the hops as of yet. Regardless, they refuse to let US craft brewers buy any CY 2017 hops believing this will afford them a competitive advantage in an increasingly competitive marketplace.
This is surely a sad turn of events. It sucks for the brewers, but has an even more tremendously shitty impact of the great guys that built a company around selling these hops to craft brewers.
This from Modern Times:
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Modern Times Beer @ModernTimesBeer 9h9 hours agoMore
Next time you consider buying beer from AB InBev & their zombie breweries, we hope you'll take this extreme dickishness into consideration
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- Modern Times Beer @ModernTimesBeer 9h9 hours ago
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So we hope you enjoyed the beers you had w/ Southern Passion, J-17, etc...Some of the best hoppy breweries in the country were using these
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- Modern Times Beer @ModernTimesBeer 9h9 hours ago
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When AB InBev merged w/ SABMiller, they took over the SAB hops farms in South Africa. Now, those hops will only go to acquired breweries
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- Modern Times Beer @ModernTimesBeer 9h9 hours ago
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Don't think macro brew acquisitions matters? Today we learned AB InBev is cutting-off all indie breweries from buying South African hops
This from Anheuser-Busch:
South Africa is not a traditional hop growing region. SAB’s R&D efforts made it possible to grow hops in South Africa but it is still less than 1% of the world hop acreage and production. This year, South Africa suffered from low yields. Previously, SAB has sold a small surplus of locally-grown hops to the market. Unfortunately this year we do not have enough to do so given the poor yield. More than 90 percent of our South African-grown hops will be used in local brands Castle Lager and Castle Lite, beers we’ve committed to brewing with locally-grown ingredients. In support of the local industry, we additionally sell hops to South African craft breweries. This means that less than five percent can be allocated to other Anheuser-Busch InBev breweries outside of South Africa.
Knowing the high demand for South African hops locally and abroad, we are working to expand local hop acreage. Depending on the 2018 crop outcome, we may once again be able to sell more hops to breweries outside of South Africa.
From our pal Mitch Steele:
Okay, I'm going to get on a soapbox here, and I hope people look at this objectively. I don't get the outrage over this situation with AB-Inbev deciding not to turn South African hops loose to American Craft Brewers. First off, SAB created the hop industry in South Africa, and owned the farms and did all the work to develop the varieties. Then AB-Inbev bought SAB, so they now own the farms. It sucks that the hops are no longer available to craft brewers, but why would any US craft brewer expect these hops to be made continuously available to them? These aren't independent farmers in South Africa, the farms are owned by AB-Inbev, and as a business they have 100% right to use the hops or sell them as they wish. If they have a poor crop and can't turn them loose to others, so be it. I don't know how any US Craft brewer who bashes AB-Inbev and brewers who sell out to them can then turn around and buy rare South African hops from AB-Inbev and think that's OK. Look, I'm not defending AB-Inbev here, I'm as appalled as anyone about what they are trying to do to the US Craft Beer Industry. But this is a separate issue in my mind. If I had a hop farm and ran a craft brewery, I certainly wouldn't support the notion that I had to make my hops available to other brewers. This isn't about a monopoly. They made the investment and developed the hop farms for their own use. Again, I'll say that what AB-Inbev is doing to the US craft industry really sucks, and directly threatens my well being. I will not support them, despite having worked for the old Anheuser-Busch for many years. But this isn't really a situation that people should focus on. Attack the illegal pay to play and buying draft lines in bars, especially in stadiums and airports. Attack the brewery buyouts and the subsequent undercutting of independent brewers. Protest when they, or any other large brewer, snatches up all the independently grown hop varieties that we are all clamoring for. Raise hell when they try to pass off beers that are brewed in 700 bbl batches as "craft". That's what really matters.
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