Anheuser-Busch InBev, the biggest beer company in the world, will no longer supply South African-grown hops to brands the company doesn't own. Unsurprisingly, the decision is brewing controversy among those in the craft beer community.
Understanding the outrage starts with understanding how beer is born. Each beer's distinct flavor and aroma is the result of a brewer using different hop varietals (of which there are thousands). Therefore, if your favorite IPA uses South African hops and the brewery isn't owned by AB InBev, you probably won't be seeing it on shelves much longer.
At this point, craft beer drinkers are used to playing David to AB InBev's Goliath. Look no further than the recent acquisition of Wicked Weed by AB InBev—a move that prompted hand-wringing from those who think "selling out" is never the answer, no matter how much success you stand to gain in the process.
But this latest controversy is more than the typical "sell-out" argument—it's a debate over what kind of industry the beer community wants for itself.
Although South African hops only account for less than 1% of the world's hop production, many beers (like Floating World by Modern Times) rely on them for their specific flavors and aromas. SABMiller, the company that owns all of the South African hop farms, was acquired by AB InBev last year and relinquished its control in the process. Citing a low yield of hops this year, AB InBev determined that it would not be selling any of the South African hops to the rest of the market.
Because hops are unique, every recipe that calls for South African hops will now have to be adjusted or thrown out altogether. Brewers who've come to use South African varieties like African Queen, Southern Aroma, and Southern Passion accuse AB InBev of hop hoarding, and say it's setting a dangerous precedent. Modern Times, a San Diego brewery, was quick to share its thoughts via Twitter:
"I was informed by SAB Hop Farms ... that [AB InBev] are commandeering all the hops that were to be allocated for distribution to North American craft brewers," an associate for the Rhode Island-based Proclamation Ale Company wrote on Facebook.
"It sucks for the brewers, but has an even more tremendously [expletive] impact [on] the great guys that built a company around selling these hops to craft brewers."
It didn't take long for the anti-"Big Beer" narrative to take shape among beer communities like Beer Advocate. By flexing its financial muscles and limiting the sale of South African hops to brands already under its control, many beer hobbyists say that AB InBev is assuming the role of the schoolyard bully, using its power and payroll to disadvantage the scrappy underdogs.
But not everyone feels this way.
"It's ingenious from a business perspective," says Matt Sander, Lead Brewer of the up-and-coming brewery Little Known Brewing. "Hops are an agricultural product with an extremely high investment in innovation. It is very expensive and time-consuming to develop a new commercial variety. The breweries that [AB InBev] buys will be the only ones who can access these new and exciting hops."
In other words, Sander says, "I don't think Pfizer should have to share Viagra with [its] competitors."
And then there's AB InBev, who was quick to respond to the backlash. Here's a portion of a statement issued by Willy Buholzer, the Global Hops Procurement Director at Anheuser-Busch InBev:
This year, South Africa suffered from low yields. Previously, SAB has sold a small surplus of locally-grown hops to the market. Unfortunately this year we do not have enough to do so given the poor yield. More than 90 percent of our South African-grown hops will be used in local brands Castle Lager and Castle Lite, beers we’ve committed to brewing with locally-grown ingredients.
In support of the local industry, we additionally sell hops to South African craft breweries. This means that less than five percent can be allocated to other Anheuser-Busch InBev breweries outside of South Africa.
Knowing the high demand for South African hops locally and abroad, we are working to expand local hop acreage. Depending on the 2018 crop outcome, we may once again be able to sell more hops to breweries outside of South Africa.
In other words, the AB InBev stands by its claim that the move was the result of low hop yields in South Africa, and if 2018 brings a more bountiful hop haul, it may be able to once again allocate South African hops for breweries like Modern Times and Proclamation Ale.
In the meantime, the debate among beer drinkers continues. On the Beer Advocate forums, some are pointing to this latest move as further justification for a boycott of AB InBev beers, (in particular, the craft brands that've been acquired by the conglomerate, like Goose Island, Elysian Brewing Company, and Wicked Weed). Others see it as a byproduct of the free market—after all, AB InBev invested in SABMiller's hop farms fair and square.
For now, beer drinkers will have to hold their breath and hope that their favorite brew isn't affected by this turn of events—or wait to see what next year's harvest brings.