Rising beer prices could leave you tapped out

Double-whammy shortages of two main ingredients are threatening to send the price of beer significantly higher, just in time for the national drinking holiday known as Super Bowl Sunday.

After water, the biggest components of most beers are malted barley, whose sugar starches are fermented into alcohol, and hops, which add the bitter tang. In recent months, both have been in increasingly short supply, and when they have been available, their prices have leaped — by as much as 500 percent in the case of hops.

“We were told about a week ago we wouldn’t be able to buy hops again this year unless we were on a waiting list, and there [were] 100 brewers ahead of us,” said Peter Martin, head brewer at Brown’s Brewing Co. in Troy, N.Y.

In September, Martin paid $4 for a pound for hops. By late October, he said, it was $50 a pound. Likewise, barley prices have almost doubled in the same period.

Just a few weeks ago, George Peterson, owner of Central Coast Brewery in San Luis Obispo, Calif., spent $160 to brew a batch of beer equal to eight kegs. Last week, he was spending a staggering $920 per batch.

“It’s a big deal, and it’s something that you have to think about every day because it’s an ingredient. I can’t just pick up the phone like I used to and say, ‘Hi, I need 45 pounds of this,’ ” Peterson said.

Small breweries feel the worst pinch
Brewers said the average cost of a six-pack of domestic beer would likely rise about a dollar by the end of the month, just a few days before the Super Bowl. Retail tracking services say beer sales traditionally rise as much 15 percent in the two weeks before the game.

Customers at Tied House Cafe & Brewery in Mountain View, Calif., are already paying more after the pub raised prices by 25 cents a pint — a bargain compared with the 75-cent-a-pint hike at Los Gatos Brewing Co. in Los Gatos, Calif.

“As a smaller brewery, it’s hard to find the hops that I need because some of the bigger guys have them,” said Kent Wheat, brewmaster at Los Gatos Brewing.

By “the bigger guys,” Wheat meant the so-called macrobrewers, like Anheuser-Busch, which makes many of the most popular brands in America, including Budweiser, Bud Lite, Michelob, Busch and Rolling Rock. Large brewers can more easily absorb the higher costs because they negotiated longer-term contracts when prices were lower, locking up supplies that are now out the reach of many microbreweries.

“The input price on barley and hops hits small breweries the hardest,” said Trevor Schaben, brewmaster at Thunderhead Brewery #2 in Grand Island, Neb., which recently raised the price of its pints to $6.

In a statement, Anheuser-Busch said: “Like many industries, the beer industry is experiencing cost increases in raw materials. This is just one of many factors that contribute to beer costs. While we cannot disclose details of pricing, we feel it is important to offer competitive prices to growers.”

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