New Zealand: Hop producers eyeing increased export business

Increased hops production has led to a surplus of the dried flower used in beer making or for medicinal purposes, Business.Scoop reported on March 29.

South Island, New Zealand hops farmers are trying to move a glut of the pine cone-shaped flower to beer producers around the world.

More hops production driven by the global craft beer boom of recent years, coupled with dropping beer consumption, has resulted in a surplus of the dried flower used in beer making or for medicinal purposes.

Hinetai Hops has 64 canopy hectares of hops, some certified organic, at its Tapawera garden south of Motueka.

The 32-year-old company supplies hops to grower-owned cooperative NZ Hops with 24 other shareholder-suppliers found mostly around the Tasman district.

Owner and co-op director Dean Palmer said his family has farmed the hop crop since the 1880s.

He said while Hinetai has had “a good run” thanks to the increased popularity of craft beer in recent years, the hop market had always been “very volatile”.

“We’ve got a long history, and we’ve seen plenty of ups and downs. And the hop market is currently in a bit of a down,” Palmer said.

“There’s quite an oversupply of hops worldwide, and also particularly from New Zealand there’s the oversupply, given the massive production increase over the last six years or so. And then also with a few economic headwinds and some changes in beer consumption and styles, the demand has dropped back a bit too.”

Tasman-based collective NZ Hops represents around 25 shareholder-suppliers across 27 farms mostly in Tasman, and has a large coolstore for growers’ dried hop flowers.

There were more than a handful of independent hop farmers in New Zealand too, he said.

Hop gardens have been buzzing with activity this month as harvest started to wrap up for most of this week and into next.

Palmer said an “excellent growing season” with timely rainfalls was followed by an “enjoyable” harvest thanks to settled weather that allowed non-stop picking in the ripening window.

With 15 percent of the hop crop bound for the domestic market, around 85 percent was exported to markets, including to key markets the United States, Europe, Japan and Australia.

“It will take time for us to build the market, the hops we produce are very good cultivars and generally very good quality, and we have some advantages there.

“But we’re a long way from market and the cost in market is considerable and the cost getting to market is quite high compared to our competitors as well.

“It takes considerable effort in the market to grow our market share, and a lot of this new production will need to work on it to find a home.”

Palmer said Hinetai hosted around 100 brewers from Australia, the United States, Poland, Latvia and the UK just last week to try to generate new business.

As one of just a few certified organic hop producers in New Zealand, Palmer said some US hop exports failed to meet the European Union’s strict organic certifications recently, and New Zealand plugged the gap for the Europeans.

“We’ve had a bit of a win in that a lot of the US organics [hops] couldn’t make the European market requirements, they breached [maximum residue levels] MRLs for spray drift from neighbouring conventional hops, so we’ve seen a massive surge in demand just over the past couple of months due to that.”

He said it would be “a long road” back to the hot hop market of recent years – but special varieties like trademarked Nelson Sauvin, Moutere or registered Nectaron gave New Zealand an edge.

“We believe that we’ve got a really awesome offering and we’ve got additional value with things like organics and spray free that the rest of the world can’t do.

“And we also have really good varieties down here that are unique.

“We’re in it for the long-term and we believe this is a really good value proposition and a really good story.”

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