Michigan’s craft beer boom has suppliers hopping

Patrick Dunn
Special to The Detroit News

Craft beer is big business in Michigan — big enough that a number of new businesses have recently sprung up to support it, not unlike supplier firms that produce parts for the auto manufacturers.

The biggest area of expansion is in hop farming. Since 2007, the state has gone from zero acres of commercial hop farms to about 400, according to Michigan State University Extension educator and hops expert Rob Sirrine.

But the past three years have also seen the arrival of Michigan’s second malt house and its first liquid yeast lab.

Michigan Brewers Guild president Eric Briggeman said consistent growth in the industry — Michigan ranks fifth among states in the number of breweries, with well over 100 — has encouraged Michigan farmers and other producers. The craft brewing industry in Michigan supports more than 7,000 jobs and its economic impact is more than $600 million a year, according to the Michigan Brewers Guild.

“They saw the craft beer industry has been growing for 25 years straight,” he said of the growers. “Most notably, the last five years to seven years, there’s been incredible percentage and volume growth.”

In many cases, the new operations are a second job, almost a labor of love, for the beer enthusiasts who run them. Erik May founded Pilot Malt House in Jenison in 2012, inspired by hours of watching brewing-related YouTube videos. A 12-year military veteran, he still works for the National Guard in Battle Creek but is angling to eventually turn his business into a career.

“Beer’s my exit strategy, I guess,” May said.

By a long shot, hops have been the most popular crop among Michiganians getting into the industry. Seven years ago, Brian Tennis began cultivating some of the first commercial acres of hops in Michigan. In 2011, in addition to farming his own plot in Omena, he began buying, processing and selling hops for 12 other growers organized under the Michigan Hop Alliance.

“Probably 75 percent of the growers we have in the Alliance are all new to farming,” Tennis said. “They just got into it because they’re more brewing enthusiasts than actual farmers.”

Blake Mazurek is among that 75 percent. He and his wife, Anna, took sole ownership of her father’s farm in 2011 and decided to try growing hops after years of leasing the fields out to other farmers.

Mazurek lives and teaches school in the Grand Rapids area, but his farm is 90 miles away in Branch, which he said results in “some long spring and fall days.” However, with just three acres of hops he’s already done business with Short’s Brewing Company and other smaller breweries.

“It’s growing every year as far as what we’re doing on the farm,” Mazurek said. “It’s kind of starting to take a life of its own on.”

Northwest vs. Midwest

Michigan hop growers face formidable competition from massive farming operations in the Pacific Northwest, specifically Washington, Oregon and Idaho. A 2013 survey by the Hop Growers of America recorded 27,000 acres of hops in Washington, 4,700 in Oregon and 3,300 in Idaho.

“Our economy of scale in what we’re doing is so vastly different,” Tennis said. “Our prices are just going to be expensive.”

Brett VanderKamp, president and cofounder of New Holland Brewing, said Michigan hops were three to four times more expensive than their nationally available counterparts when he began buying them five years ago. By his estimate, prices today are lower, but still 50-100 percent more than out-of-state alternatives. To VanderKamp, the premium price is worth it to support fellow Michigan businesses — and to encourage more future production.

“Long term, I really view it as an investment that we’re making in these guys,” VanderKamp said. “I have self-interest in them becoming successful because it’s going to help with consistency of product.”

Wide open markets

The amount of hops produced in Michigan still simply isn’t enough to fulfill the high-volume needs of most breweries, a situation that affects other state beer-related businesses. May was making seven-pound batches of malt in his kitchen until last August, when the state Department of Agriculture officially licensed him as a malt house.

The following day he received a six-ton order from New Holland. He has since stepped up his production to a minimum 1,500 pounds per week.

“We’re just trying to expand and just get as big as is logical … and see where it goes,” May said.

Pilot is one of only two malt houses in the state. Briggeman, who is also the director of brewing operations at Rochester Mills Beer Co., says Michigan’s malt business is still far from meeting the potential of local demand.

“I couldn’t buy all the malt from a Michigan maltster for my brewery, and I’m barely cracking the top 10 as far as breweries with the most volume in the state,” he said. “It’s just a volume challenge more than anything.”

Even more wide open is Michigan’s market for liquid yeast. Emily Geiger founded Craft Cultures, a commercial yeast lab in Hancock, last summer.

She is the only liquid yeast producer in Michigan — and, to her knowledge, one of only six nationwide. Other than establishing a website for Craft Cultures, she has not advertised her product.

“Without any marketing, there has been quite a satisfying amount of business,” she said.

And she’s expecting it to stay that way. Craft beer’s rise to popularity has been swift and heady, but Geiger said she thinks it’s less a trend and more a return to the American norm.

“Through history, before Prohibition, there’s been breweries on every street corner,” she said.

“Then it went to the domestics, like Budweiser and Miller, taking over. Then that bubble popped and now we’re back to microbreweries.”

What are hops?

Humulus lupulus (hops) are the flowering cone of a perennial vining plant that typically thrives in climates similar to where grapes grow.

Hop plants are dioecious, meaning the males and females flower on separate plants — and the female cones are used in the brewing process. Hops are the age-old seasoning of the beer, the liquid gargoyles that ward off spoilage from wild bacteria and bringers of balance to sweet malts. They also lend a hand in head retention, help to clear beer (acting as a natural filter) and impart their unique characters and flavors. Basically, hops put the “bitter” in beer.

Source: beeradvocate.com