15 October, 2019
RALEIGH, North Carolina, October 15, 2019 - The global demand for hops and adjuncts is growing at a steady pace with average forward contract rates of 76 percent, according to Beroe Inc, a procurement intelligence firm. The hops cultivation area worldwide had risen by 9 percent compared to the previous year and the production of adjuncts has been growing globally, driven by an increase in demand from the brewing industry.
The major regions producing hops are the EU, for 55 percent of the total supply, the Americas for 36 percent, Asia for 6 percent, and Australia/Oceania for 2 percent. Major producing regions for sugar adjuncts are Brazil, India, Thailand, the EU, and the US. For Corn and derivatives adjuncts, major producing regions are the US, China, and Brazil, for wheat is the EU, China and India and for Rice adjuncts is China and India. The Czech Republic and England have the highest forward contract rates for 2020 at 90 percent each.
Beroe, which is based in North Carolina, further stated that procurement experts can access this report on its recently launched market intelligence platform Beroe LiVE: live.beroeinc.com
The demands from the brewing industry, in terms of volume, quality and variety are growing across the world, driving the demand for hops and adjuncts. Global adjuncts consumption by region is approximately 34 percent for corn-based adjuncts, 26 percent for sugar-based, 25 for wheat-based and 7 percent for rice-based. Changing climatic conditions affecting the yields is a major challenge posed to the market.
The craft beer segment accounts for around 1.2 percent of the global beer market volume. However, as craft breweries mostly use an aroma variety of hops in beer formation, they require almost 10 times more hops in processing. This emerging trend has, in turn, led to a shift in the demand from bitter to aroma hops across the US and the EU. The regional production of different types of adjuncts varies with regions from local preference and cultivation; hence preference to the usage of adjuncts to countries can vary from one to another.
The research methodology adopted for the report included:
The average crop cycle of hops is two years, and suppliers fix the forward contracts, along with the price and volume for the upcoming years, based on yield rate, alpha content, etc. Prices for adjuncts reflect the supply-demand situation at any point in time of the particular grain. Predominantly the prices are fixed in forward contracts, and premiums/discounts are considered to this with respect to yield, demand, and certain other parameters
The report also includes:
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