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Thread: So, Your Ingredient Costs are Doubling...

  1. #1
    Join Date
    Jun 2003
    Location
    Louisville, KY
    Posts
    993

    So, Your Ingredient Costs are Doubling...

    what are you doing?

    This topic has been floating around the BA Forum with no real responses, so I thought I'd throw it out here.
    Cheers & I'm out!
    David R. Pierce
    NABC & Bank Street Brewhouse
    POB 343
    New Albany, IN 47151

  2. #2
    Join Date
    Oct 2002
    Location
    Lansing, MI
    Posts
    144
    Has anyone got any real information on what the price increase is going to be? I've been asking around and nobody has any info other than there is going to be a rise in malt prices. Somebody has to have some sort of idea by now.

  3. #3
    Join Date
    Aug 2005
    Location
    Eugene Oregon
    Posts
    125

    what I heard

    I've heard about .10/lb, but that of course was not confirmed. Doesn't seem like much, but that is 30% of base malt price.

    I was in desperate need of a .25 cent increase on beers at our pub. This increase, in effect 9/1, will help quite a bit. (3.75 pints up to 4.00 pints; seasonals stayed at 4.25) Chicago suburb market.
    Also, as a 600 bbl/year brewpub where we use a lot less ingredients in a year and 65% of gross comes from restaurant side, I think we won't see much hurt.

  4. #4
    Join Date
    Jul 2006
    Location
    Oconomowoc, WI USA
    Posts
    106
    2007 Cascade price at around $10 a pound.

    http://www.probrewer.com/vbulletin/s...ead.php?t=8916

  5. #5
    Join Date
    Oct 2002
    Location
    East Syracuse, NY
    Posts
    299
    I switch my base malt and use a little more specialty grains. Dropped low alpha hops for bittering and added high alpha. I'm not sure the market will allow for too much of a price increase

  6. #6
    Join Date
    Jun 2006
    Location
    Amherst, MA USA
    Posts
    324
    Being that we are just starting to build our new brewery, I feel that we are at a slight advantage when it comes to the pricing/inventory issues. You see.. we have not made beer with certain ingredients for so long that we don't want to change them. I am using the best possible ingredients for the money and will settle on not using a certain malt because of price. i also am looking at inventory of hops...ugg but I have chosen wisely based on what HopUnion is telling us... I just contracted for our hops and figured for about 14 months worth. I went with more high alpha then I would have typically but it makes sense nowadays.

    What is everyone else doing?

    Matthew


    EDIT... just to clarify.. in no way do I feel like I am compromising the quality of my products by purchasing certain malts that are cheaper. in fact, I believe the malts we have chosen are world class, and may be alittle cheaper than some overly 'popular' varieties that have a name attached.
    Last edited by MatthewS; 09-26-2007 at 06:23 AM.
    ________________
    Matthew Steinberg

    Brewer
    High Horse
    Amherst, MA

  7. #7
    Join Date
    Oct 2002
    Location
    Lansing, MI
    Posts
    144
    I heard Castle Malt is going up seven cents per pound and Wyermann is going up 40%, this comes from Brewers Supply Group.

  8. #8
    Join Date
    Jul 2006
    Location
    Oconomowoc, WI USA
    Posts
    106

    cutting back

    My cost of raw materials, (malt, hops, H2O treatment and yeast) runs between 6% and 11%. The increase in pricing is not going to effect my beer, I am not going to make changes. We do an all grain Double IPA,for each barrel we use 120 pounds of Maris Otter, and 4.3 pounds of hops, (2006 price for these hops $7.50 a pound). This beer is our 2nd most popular, if we start making changes to the beer I can trust that sales will drop.

    To save on the high cost of the malt our second runnings go for a Bitter. We get around and extra 0.7 bbls of wort per barrel at around 1.040 or 10 degrees Plato.

    I also prop my own yeast. The cost of a lab for propagation is frugal over time and pitchable quantities of yeast.

  9. #9
    Join Date
    Mar 2003
    Location
    Nashville
    Posts
    691
    Munton's Pale malt is going up 10 cents a lb by the container load, and a good bit more by the pallet, according to Crosby and Baker. Weyermann is also going up 10-15 cents a lb too they say,
    Linus Hall
    Yazoo Brewing
    Nashville, TN
    [url]www.yazoobrew.com[/url]

  10. #10
    Join Date
    Dec 2003
    Location
    London, United Kingdom
    Posts
    181
    Hi,

    Yes, malt and hops are increasing dramatically. Over the past two years there have been harvest issues for both of these commodoties.

    Malt is looking to increase by up to 100%, depending on your individual contracts, existing prices, supplier, etc. There is generally an undersupply of malt and a net increase of brewing in the world (fuelled by large growth in China and Eastern Europe). The only thing that will take pressure off this price rise is a fantastic harvest in all global areas - if you are in the US and the US has a good harvest, it does not mean that you will necessarily see a reduction in price - the global brewers are competing for the materials which is driving price up.

    Hops are also in the second year of devastating harvests. There is a serious undersupply issue coming out of the Cz Rep, and many Saaz contracts (and similar varieties) cannot be filled - so many people have to look towards alternatives. With a few other disasters around (i.e. recent ones in Oregon and Idaho, and eastern europe), combined with lower alpha yields, pricing is currently skyrocketing. 2006 supply issues have carried foward to 2007, and now 2007 issues will carry foward to 2008.....

    So perhaps get ready for some price increases......

    Alex

  11. #11
    Join Date
    Feb 2004
    Location
    Dexter, MI USA
    Posts
    203
    Hello All,

    As my prices rise, so must my prices rise. The market will bear it. They have to. Just as I pay over $3 a gallon for gas, they have to. If quality is there, I will pay the price. My issue this year is; prices went up, and quality down. This I take issue with. As should all. I will switch my purchasing on quality, not price. Price up, quality down, I look elsewhere. Price up (everywhere) and quality the same, well then, we can talk. Brew the beer you want to brew. Just raise your prices. You have to. I am. The people who appreciate your beer will understand, and thank you for not compromising.

    Cheers,
    Ron
    Jolly Pumpkin Artisan Ales
    PS But at the same time, demand from your suppliers that they supply more, better, barley and hops! We are small, but we are mighty!

  12. #12
    Join Date
    Feb 2005
    Location
    Helena, Montana
    Posts
    292
    Amen Brother Ron!

    I too agree with Ron - don't change your beer or decrease the quality of your ingredients. The market will bear it - we are all pretty much at the mercy of global market conditions for our inputs and everyone will have to either increase prices or eat the difference.

    Forecast and Contract!
    I have been hearing for years that small brewers should be prepared to contract our ingredients. I started years ago with certified organic hops, last year I locked up our Cascade supply, and I'm really glad I did this year again -they were still reasonably priced back in July. And finally bulk malt for this harvest year.

    FYI, I was told a couple of weeks ago by our malt supplier to expect some malt increases as high as 70%.

  13. #13
    Join Date
    Oct 2002
    Location
    East Syracuse, NY
    Posts
    299
    I guess I should clarify something. I switched brewers, I'm a contract brewery, and found that I prefer my new malt, Canada malting to my old malt, Franco belges and its cheaper which is a great bonus.

    K

  14. #14
    Join Date
    Oct 2005
    Location
    san diego, ca.
    Posts
    183
    I just switched my base pale malt from weyer. to crisp. Mostly because they batches I did with the weyer were at least 1 plato short of what it should have been. After switching to crisp my numbers are right it was a couple of cents cheaper and honestly i prefer the taste =)

  15. #15
    Join Date
    Nov 2002
    Location
    West Chester, PA
    Posts
    393
    Raise your price. We are. Most beer isn't expensive enough anyway.
    Larry Horwitz

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