A-B InBev to cut off sales of South African hops to indie brewers

Discussion in 'Beer News & Releases' started by reefer_bob, May 10, 2017.

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  1. reefer_bob

    reefer_bob Initiate (0) May 13, 2014 California

    From Modern Times' Twitter feed... "Don't think macro brew acquisitions matters? Today we learned AB InBev is cutting-off all indie breweries from buying South African hops"

    I don't know how much of the SA hops are controlled by inbev...
  2. jageraholic

    jageraholic Maven (1,366) Sep 16, 2009 Massachusetts

    Take that everyone who pulled out of the Funkatorium Invitational.
  3. hopfenunmaltz

    hopfenunmaltz Pooh-Bah (2,549) Jun 8, 2005 Michigan

    Some searches show that SAB was doing the breeding and farming. ABInbev bought SABMiller, so now controls those.

    I think J-17 has been used in a few beers in the US. Hey @erway, wasn't J-17 used in Elevated at one time?
    ONovoMexicano and SFACRKnight like this.
  4. Macsimus

    Macsimus Zealot (728) Feb 19, 2014 North Carolina

    SMH - what are they doing? Ultimately this will come back to haunt them....extremely short sighted!!
    ONovoMexicano and chrismattlin like this.
  5. reefer_bob

    reefer_bob Initiate (0) May 13, 2014 California

    Casa Agria just posted a similar item...

    "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. So unfortunately, there will be no CY 2017 hops available from ZA Hops. Whether they decide to sell to the craft beer market independently is unclear at this point should they not be able to allocate all the hops internally. This is a shocking turn of events, though commensurate with ABI’s business practices, and devastating to my company – yet another blow to craft beer."

    CASA along with every other independent brewery in the United States will no longer be able to purchase South African hops. The buyout also has a very negative business impact on this hop distributor.
  6. BBThunderbolt

    BBThunderbolt Grand High Pooh-Bah (7,210) Sep 24, 2007 Kiribati
    Pooh-Bah Trader

    Every bottle of BCBS we buy, is dollars that go to finance shit like this.
    2beerdogs, NWer, WA_Brian and 69 others like this.
  7. drtth

    drtth Initiate (0) Nov 25, 2007 Pennsylvania

    ABInBev has long term contracts with certain hop farms and with certain rice growers. Has anyone ever been allowed to buy from the stock created by those farms?

    If SAB Miller controlled/owned those South African hop field did they ever sell any of those hops from those fields to Indie brewers in the US?

    If not, nobody has been cut off from anything that they used to be able to buy.
    lester619 likes this.
  8. ericwo

    ericwo Crusader (468) Aug 21, 2008 Pennsylvania

    Could not agree more. All of those people that are saying "as long as the quality stays the same, I'll still buy from xyz brewery", just don't get it.
  9. SFACRKnight

    SFACRKnight Grand Pooh-Bah (3,142) Jan 20, 2012 Colorado
    Pooh-Bah Trader

    Last I heard he was pretty low on that hop, but IIRC he was using it.

    These are just signs of the times, that sab ab deal should never have happened. Sure seems like a monopoly to me.
  10. Harrison8

    Harrison8 Grand Pooh-Bah (5,509) Dec 6, 2015 Missouri
    Pooh-Bah Trader

    I'd like to know the answers to both of these questions, but more so the latter. It sure is implied that independent craft brewers had access to these hops before, but I don't want to jump to conclusions based on implications.
    tasterschoice62 likes this.
  11. jesskidden

    jesskidden Pooh-Bah (2,969) Aug 10, 2005 New Jersey
    Pooh-Bah Society Trader

    So, wait. "Craft" brewers want consumers to boycott ABInBev's beers but are now angry that "craft" brewers can't buy ABInBev hops? :astonished:
  12. drtth

    drtth Initiate (0) Nov 25, 2007 Pennsylvania

    I think I'd also like to know why an indie brewer would be buying hops from one of the Big Beer companies in the first place as well.
    FFFjunkie, Tripel_Threat and Junior like this.
  13. ElijahSF

    ElijahSF Initiate (0) Aug 30, 2013 California

    Cellarmaker‏ @CellarmakerBeer:

    Think AB Inbev purchases don't matter for the craft beer industry? All South African Hops have been allocated to AB InBev "High End" brands.

    There's nothing "high end" about it. Please consider where you spend your hard earned dollars. Ownership matters. On to the next cool hop...

    We’ve got a full pallet of South African hops left. Should still be in beers for about a year or so. Enjoy em' while they last I suppose.
  14. drtth

    drtth Initiate (0) Nov 25, 2007 Pennsylvania

    I think that nails it. Interestingly enough the source of those hops that people are upset about was apparently from one of the bad guys in the first place if the hop field were previously owned/controlled by SABMiller. :astonished:
    tasterschoice62 likes this.
  15. Todd

    Todd Founder (13,172) Aug 23, 1996 California
    Staff Super Mod Pooh-Bah Society Trader

  16. Macsimus

    Macsimus Zealot (728) Feb 19, 2014 North Carolina

    I am amazed at the way this thread has gone - things that make you go hmmmmmm.
  17. hopfenunmaltz

    hopfenunmaltz Pooh-Bah (2,549) Jun 8, 2005 Michigan

    1. Those were unique.
    2. SABHF was part of SAB. http://www.sab.co.za/the-sab-story/proudly-south-african-hop-varieties/
    3. Excess hops are sold to brokers, who then would import to the US. BarthHaas for one, there are others.
    4. As a homebrewer I see I can buy South African hops from Northern Brewer Homebrew Supply. They were bought recently by an arm of ... ABInBev! That purchase is starting to make some sense.
  18. Harrison8

    Harrison8 Grand Pooh-Bah (5,509) Dec 6, 2015 Missouri
    Pooh-Bah Trader

    To reflect on my previous statement - it looks as though independent breweries did have access to these hops in large quantities. This really does stink for craft beer. Makes me wonder if Heineken's full acquisitions of Lagunitas has AB-InBev feeling some pressure.

    As I've said before, I'll continue to buy local, and trade for other local stuff across the nation. No need to buy anything big name anyway. It does amaze me how much AB-InBev is getting away with though.
  19. pd5000

    pd5000 Initiate (0) Feb 10, 2014 California

    "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."

    This has a huge trickle down effect. All of you who don't get this are either shills or really just that oblivious.
  20. BoldRulerVT

    BoldRulerVT Initiate (0) Oct 2, 2013 Vermont

    I've continued to buy BCBS and this is finally the reason I will stop. This shit can not be supported.
    2beerdogs, 66jzmstr, smi69 and 25 others like this.
  21. beermeplz

    beermeplz Initiate (0) Feb 13, 2015 California

    i've never been keen on supporting ABI breweries but didn't boycott them outright....that changes now
  22. hopfenunmaltz

    hopfenunmaltz Pooh-Bah (2,549) Jun 8, 2005 Michigan

    Those hop farms have other long term contracts. The big Brewers buy mainly Alpha varieties. More aroma varieties are grown now, and the majority of hops grown in the US today are aroma varieties, that's what the craft brewers are buying. One other thing, a lot of hops are turn into extract, which goes on the market. It also stores well if there is a surplus.

    ABInBev has a large hop farm near Bonners Ferry ID. That has been their in house farm. The craft breweries they bought talked about getting hops from there. None of those hops would go to outside breweries, I would think.
    drtth likes this.
  23. croush

    croush Initiate (0) Mar 20, 2015 Illinois

    I'm not trying to start something here (really, I promise!), but why wouldn't A-B InBev do this? They own a bunch of hops, and now have a bunch more "craft" breweries that may need those hops? Why wouldn't they keep them for themselves?

    I've heard some interesting, thoughtful arguments as to why people won't support A-B InBev, but I'm missing out on why this development would change people's minds. Again, I'm genuinely curious...not trying to stir up anything.
    PA-Michigander, tzieser and Alexmc2 like this.
  24. Ceetar

    Ceetar Initiate (0) May 7, 2009 New Jersey

    Because this is a further step to control the selection. THEY want to be the ones to pick which craft beers are on the shelf.

    This is insidious though. This doesn't suck because we're not going to have access to the hops, because WE are. WE can just buy the new Wicked Weed or Elysian IPA or whoever that's making a cool beer with interesting flavors not available to everyone else. And you know what? we will. That's why it sucks.
  25. Harrison8

    Harrison8 Grand Pooh-Bah (5,509) Dec 6, 2015 Missouri
    Pooh-Bah Trader

    It's all good. You raise a good question. I believe it's mostly an emotional reaction from folks here. We're on Beer Advocate to talk about, evolve, consume, and advocate for good beer. Most of that beer comes from independent breweries. So buy-outs and business decisions perceived as "strong arming the little guys", or at the very least picking one of the independent breweries out of the independent market, are not well received since it flies in the face of innovation and supporting local, smaller businesses.

    This is a smart choice for AB InBev in a way. For one, it gives them more access to in-house hops, so they don't have to pay a middle man. It also gives their brand a chance to innovate with hops that others don't have access to. If the properties these hops deposit in the beer happen to become the next trendy hop quality, AB InBev has complete access to the gold mine, with no competitors. Those advantages for an already powerful organization are rather discouraging when you consider the impact that will have on craft breweries already struggling to offer quality beer at price points for the common consumer.
  26. drtth

    drtth Initiate (0) Nov 25, 2007 Pennsylvania

    Thanks for the additional info. For me that's one of the benefits of BA, the opportunity to learn from others who know things I don't.

    As for the purchase of Northern Brewer I very recently had a similar insight that there might be something deeper and more long range going on there.
    frozyn and Harrison8 like this.
  27. BStrummin

    BStrummin Initiate (0) Sep 8, 2014 California

    THIS is why so many of us are against the "sell outs." It's not about Tony or whoever getting rich, it's about giving macro more power to stifle small, local craft.
    NWer, kwakwhore, mikeinportc and 21 others like this.
  28. zid

    zid Grand Pooh-Bah (3,036) Feb 15, 2010 New York
    Pooh-Bah Society Trader

    Why do I feel like there wouldn't be the same level of vitriol if we were talking about barley malt?
  29. Original_Fake

    Original_Fake Initiate (0) Nov 15, 2013 North Carolina

    Your question gets at the very issue of AB InBev being involved in the "craft" work. Why wouldn't they do this? There's no business reason why they wouldn't. And it's probably going to make them corner more of the natural resources that go into beer production if they can.

    I agree with you on why this is the thing that's changing people's minds though. This is exactly the sort of thing that people should have expected once AB InBev started making these buyouts and it wouldn't surprise me if it becomes more regular.
    BBThunderbolt and BStrummin like this.
  30. reefer_bob

    reefer_bob Initiate (0) May 13, 2014 California

    Could AB go up and buy all the hop farms in the PNW I'm not educated on how the PNW Hop growers are organized...
  31. HouseofWortship

    HouseofWortship Pooh-Bah (2,557) May 3, 2016 Illinois
    Pooh-Bah Trader

    Damn you AB! The minority with wealth oppressing the masses of craft brewers. I never thought this kind of thing could happen in South Africa...
  32. hopfenunmaltz

    hopfenunmaltz Pooh-Bah (2,549) Jun 8, 2005 Michigan

    NB has started to come out with kits for the purchased breweries beers. Goose Island was the first, now an Elysian kit, more to come.

    If ABInBev can supply grains and hops to NB for a lot less than the Homebrew Suppliers like BSG and Country Malt, then the local shops that buy from them will be at a cost disadvantage.i am not sure how they would accomplish that.
    GetMeAnIPA and SFACRKnight like this.
  33. Alexmc2

    Alexmc2 Initiate (0) Jul 29, 2006 New Hampshire

    No. Don't worry, your Cascade is safe from big brother. :wink:

    I posted about this topic in another forum. SAB seems like they didn't fully utilize the hops they had under contract and the excess was sold to brokers who then sold to craft brewers. Now ABI owns them and wants to gain a competitive advantage from the resource they purchased.

    Any breweries that put themselves into a situation where they were depending on spot market hop purchases made life extremely difficult on themselves.
  34. Alexmc2

    Alexmc2 Initiate (0) Jul 29, 2006 New Hampshire

    Yes! This is by far the worst injustice ever visited upon that country...
    Roguer, kwakwhore, eppCOS and 10 others like this.
  35. jkblr

    jkblr Grand Pooh-Bah (4,696) Nov 22, 2014 Indiana
    Pooh-Bah Society Trader

    The point is how they do business. What happens when InBev/Miller/Coors can afford to buy a contract for all the citrus, Nelson, or galaxy hops on the planet? The bad news is we (the > 1% of beer drinkers) can't realistically make change. I can tell my wife she has to stop drinking Mich Ultra because it's made by an evil empire. When she asks why, I can explain their business practices but it doesn't effect her. She's not switching to PBR. The whole thing sucks because real craft prices are going to explode over the next few years as the giants play this out. And when they achieve their goals, everything in their "craft" portfolio will be dumbed down so they can increase their marketing budget. I guess I'll be planting hops in addition to homebrewing.
    HermitDan, Brolo75, VABA and 3 others like this.
  36. jbakajust1

    jbakajust1 Pooh-Bah (2,456) Aug 25, 2009 Oregon

    No, they are angry that ABI used their purchase/merger with SABMiller to remove Craft Brewer's ability to buy hops that were not owned by ABI prior to now, that ABI had no interest in before now. It's not like ABI owned these hops before and sold them to Craft Brewers and now isn't.
  37. drtth

    drtth Initiate (0) Nov 25, 2007 Pennsylvania

    More food for thought. But at this stage I'm not sure they are trying to accomplish that so much as establish a presence in a market segment they had previously ignored. There are several indications that for a long time home and craft brewers were "in the noise" or flying under the radar for them. Now they are in the position of playing catch up to a market trend that they originally ignored or wrote off as being too small to bother with.

    One of the reasons I don't think they'll be able to dominate is that the current growth of the craft segment of the beer market seems to be fueled by a few demographics, perhaps the largest of which is a demographic that highly values being able to buy their from an independent local source (with emphasis on local).

    While they may well come to have a big enough share of the home brew market to cause difficulty for suppliers such as BSG and Country Malt I'd say that concern for independent and local is growing in the brewing community in general. Who would have thought 5 years ago that a locally based malting using locally sourced barley could be successful? Yet that seems to be a growing trend.
  38. Spreetaper

    Spreetaper Initiate (0) Jul 16, 2014 New York

    Other Half last year also made a beer (if not more) with SA hops.
    But not really surprised being South African myself - the craft industry down there is super young.[in my estimation about 10-15 years behind us if not more] Most of the drinking public in SA is not ready for anything too hoppy.. Very easy for the big boys to swoop in and do whatever they please and understand the international market much better...
  39. Jlabs

    Jlabs Pooh-Bah (2,558) Nov 11, 2013 New York

    AB In-bev flexing its muscles yet again....:slight_frown:
  40. ovaltine

    ovaltine Grand Pooh-Bah (5,719) Apr 6, 2010 Indiana
    Pooh-Bah Society Trader

    Hmmmmm ..... Restraint of Trade stuff can get pretty dicey for the restrainer. If they keep this up, they'll attraction attention that will (eventually) lead to action that will not be in that conglomerate's best interests.
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