False: YCH has an oversupply of hops

False: YCH has an oversupply of hops

February 28, 2018 / News & Events

YCH HOPS (YCH) is on the hunt for some of today’s leading industry myths. With ongoing speculation surrounding the current state and future of hops, YCH is committed to transparency regarding the rumor that YCH has a significant oversupply of hops that cannot be sold.

As a grower-owned company, YCH is constantly monitoring demand so we have the best information available when we adjust our annual procurement plans every spring, prior to planting. While part of the supply and demand risk for the grower and the brewer is mitigated with mid-to-long term contracts, demand is somewhat dynamic depending on consumer needs and tastes for different styles and types of beer.

Jennifer Riddle, YCH Master Planner, says that during times of substantial inventory among certain varieties, we have procedures in place for utilizing products to their maximum potential.

“When we are long on a variety, we have several options we can pursue,” she continued. “We start by analyzing demand in the regions globally and identify focused opportunities to move volume.”

In addition to our re-allocation efforts, Riddle said YCH considers extracting the volume to get higher yield, exploring other markets for hops outside of brewing and/or donating product to colleges or nonprofits for analytics and brewing trials.

“YCH is devoted to continual improvement, and an important part of that is the year-round monitoring and balancing of supply and demand, so we can make course corrections as needed,” said Riddle. “We work directly with growers, suppliers and brewers to adjust procurement contracts when we’re sure the course correction is needed to enable both brewers and growers to thrive.”

According to Steve Carpenter, Chief Operations Officer at YCH HOPS, it is crucial for us to be flexible in our approach, as to create the highest value for our customers.

“We work hard to keep our supply aligned with demand,” he said. “We don’t always get it exactly right because demand is dynamic and our supply is subject to the risks associated with producing an agricultural crop.”

According to Kate Ruffing, Chief Marketing Officer at YCH, our overall inventory position is very similar to prior years. In fact, we have slightly fewer hops than last year, driven by strong overseas demand.

As hops are an agricultural product that is planted and harvested once per year, market demand from contracted and spot-purchase consumers is communicated to our growers every spring, allowing them to plant the right number of acres with the right varieties. Our strategic planning and procurement teams work to provide the most accurate forecast to our growers, despite the sometimes-unpredictable nature of both the brewing and farming industries.

YCH aims to focus on creating value for our customers and prefer working with brewers who take a long-term view of their business and who recognize that great hops are a key component of great beer. We are continually committed to our mission: Connecting Family Farms with the World’s Finest Brewers.

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