Hop market

Hops are essential for the brewing industry, since they greatly contribute to the organoleptic qualities of beer, including taste and flavor. The world acreage under hops is about 50,000 hectares of various bitter, aromatic and flavor hop varieties. Global hop yields reach approximately 100,000 tons of hops and up to 10,000 metric tons of alpha-acids. The hop industry in Slovenia has traditionally been involved in the global market of brewing raw materials, with about 3% of the global hop acreage.

The economic situation in the hop industry is largely conditioned by the growth of the global brewing industry (2 billion hl of beer per year). Its demand for hops, the possibilities of hop processing and the storage of hop products, as well as activities of a few global hop retailers also affect the economics of hop production. The important factors in assessing the economics of the hop industry are the crop and the price level, as well as production costs. Market analysis is based on regular meetings’ results of the Economic Committee within the International Hop Growers’ Convention (www.ihgc.org), various foreign hop merchants’ business reports, as well as our personal contacts with growers and hop merchants.

In addition, within the advisory service, we estimate the total hop production costs – based on a model calculation (SIMAHOP). The model embraces (i) fixed costs (depreciation, maintenance of buildings and machinery, capital in production, labor of family members, insurance, social security contributions) and (ii) variable costs (material, seasonal work, energy) for an average hop farm in Slovenia. A what-if costs’ simulation for individual farms is also possible. Costs calculations are an important decision-making element in the sale of hops.

Global hop market updates and hop industry management information are periodically published in the journal Hmeljar – Hop Grower.

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