First oil, now beer: the rising cost of necessities

by Rob Peters | July 21, 2008 at 10:31 am

607 views | 6 Recommendations | 13 comments

The rising cost of hops, fuel, and aluminum is creating a perfect storm for beer makers--and by perfect I mean horrible. The cost of these economic realities may soon be passed on to the innocent beer consumer, and even worse, it's the microbrews that will likely be hardest hit. On the plus side, though, at least now there's a justifiable excuse to stock up.

Thanks to high gas prices you're shelling out more to drive to the beer store and thanks to a series of economic challenges facing brewers you may soon have to fork over even more cash for a case of suds.

Brewers big and small are trying to cope with the high cost of energy, aluminum and hops this summer. They've managed to bear much of the increase but may soon be forced to pass the buck to the consumer.

"We've been able to shield the consumer up till now, we've been able to absorb those costs," Paul Gautreau, brewmaster and vice-president of operations for Calgary-based Big Rock Brewery, said. "How long that will go on I'm not too sure, but at some point there's going to be a break point and we'll have to share some of those costs with the consumer."

The price of hops has risen sharply after farmers abandoned the crop following a decade-long oversupply. Now beer makers are dealing with a worldwide shortage. Aluminum costs have skyrocketed thanks to growing demand in China and India.

The summer also got off to a cool start in many parts of the country, which apparently quelled Canadians' need to down a cold frosty one.

And the sky-high cost of fuel is forcing brewers to rethink their transportation costs.

The increased costs of making beer are apparently hitting the smaller brewers the hardest. The big players, including Molson Coors and Labatt, haven't been greatly affected, according to BMO analyst Orin Baranowsky.

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FionaSara

flagged this story as Good Stuff

at 14:03 on July 21st, 2008

Pretty interesting.

hector.acuna

at 14:44 on July 21st, 2008

When the temperatures reach over 110 degrees, Arizonan's reach for their favorite brews. Fat Tire on tap at a saloon in East Phoenix, Arizona.

hector.acuna has contributed a photo to this story.

mousiekm

flagged this story as Good Stuff

at 15:34 on July 21st, 2008

Rob Peters, I like this story. It's good stuff.

Bryan and Phia

at 15:50 on July 21st, 2008

This is actually more true then we realize. At Stone (pictured above) they mentioned that the high costs of Hopps is certainly effecting the cost of beers and they way they are produced. They even did a tasting of a couple of beers that we're very low in hopps and flavored by different methods, aging and what amounts to being a Giant tea bag of fruits and cirtrus that they steeped into the beer. Things keep going up like this and the things we know are going to be fundamentally changed, even beer.

lnahmias

at 16:05 on July 21st, 2008

Well, I think the high prices of this particular beer were more related to food/beverage contractors screwing over amiable baseball fans...Major League Baseball has no scruples either. But I digress...

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captargh

at 18:28 on July 21st, 2008

My friend Brad, freshly back from an oilfield work contract in Malaysia, enjoying a good American beer in the Lake!

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J.Frank Parnell

at 03:54 on July 22nd, 2008

cheers everybody everywhere!

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Gord Harrison (not verified)

at 05:45 on July 22nd, 2008

best beer I've had this summer came from a home brewer in London, ONT who grows his own hops and uses CO2 cartridges to carbonate.

His methods are a bit too time consuming and costly for me but my own home brew (Scottish Heavy recipe by Brewmaster) comes in a close second, costs less than $20 per batch and makes 3 conventional sized cases of 24.

The perfect storm (rising costs of malt, hops, aluminum, energy etc.) will perhaps encourage a few more people to be less dependent upon heavy industry to produce a product that can easily be cooked up at home and stacked beside a computer desk.

Learning curve - 5 minutes.

Anyone for a cold Scottish heavy?

Gord H.

Carsten Lorentzen

at 07:53 on July 22nd, 2008

We don't seem to be affected by this in Denmark, but I feel with you :)

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valeskawhitney

at 08:06 on July 22nd, 2008

Debbie drinking beer at Darcy McGee in Ottawa, CA 2008. I love this picture.

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y0ux

at 08:16 on July 22nd, 2008

Someone said that Germany has the best clear beers, someone else said Belgium has the best especial beers, but trust Netherlands has some of the best Trappist beers plus is in middle so then you have the best of both sides.

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Peter,UK (not verified)

at 01:21 on July 23rd, 2008

Without a doubt the best beers in the world are brewed in Belgium the very best and rarest being Westvleteren12 this is sometimes available at Cambrinus bar/restaurant in Bruges. I cannot recall a better beer anywhere else that I have visited in Europe, but I am a great fan of the beers from Dogfish Head brewery in Delaware,USA, particularly their 120 minute IPA which is over 20%abv and an absolute delight to drink. Unfortunately they are not currently exporting to the UK but maybe one day!,

peter270246

at 01:49 on July 23rd, 2008

My friends John and Mark enjoying a glass of Westvleteren12,widely accepted as the best beer in the world,brewed to 10.2% abv at St Sixtus monastery in west flanders, Belgium. This was taken at Cambrinus bar/restaurant in Bruges, their beer list includes over 400 beers, the food is great too, many dishes using beers from their list. Well worth a visit! Anyone who loves beer should visit Bruges.

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