This week we catch up with Tim Lord from Hop Products Australia about the 2015 hop harvest and what t means for the Australian beer industry. As often happens when beer is a conversation, some of the best discussion happened at the end of the interview. As we were saying goodbyes, Tim amplified some of the things we had discussed during the interview including how the Australian hop industry may not have survived but for the current craft beer resurgence. Tim has kindly let us keep this informal chat in the show. It’s a great listen.
We then speak to Richard Adamson from Young Henry’s about the brewery’s expansion into Western Australia and the recent announcement of a new brewery in Adelaide to find out how about the brewery’s strategy and how it is managing this growth, including taking on third-party investors to assist with expansion.
Craft beer on the nose?
HPA invests $15 million to grow production by 50%
In a strong vote of confidence in the future growth of the global craft brewing industry, Hop Products Australia (HPA), growers of Galaxy™, has unveiled plans to invest $15 million in hop growing operations in Victoria and Tasmania, to grow by 50% over the next three years.
The major investment includes the purchase of new land, advancement of picking and kilning infrastructures and the development of new plant propagation facilities at both Rostrevor Hop Gardens in Eurobin, north Victoria, and Bushy Park Estates in Tasmania – in a momentous year for the latter, which is celebrating its 150th continuous harvest this March.
On the eve of the 2015 harvest, the multi-million dollar announcement highlights HPA’s continuous evolution, from commodity hop growers to breeders, cultivators and suppliers of proprietary hops. The craft beer market has experienced 10% YOY growth for the past five years in Australia alone1.
HPA Managing Director Tim Lord said; “Our farms are amongst the oldest continuously operating hop farms in the world – dedicated to hop growing since the late 1800s. We are investing to help satisfy the demand for our proprietary hops, such as Galaxy™, Ella™ and Vic Secret™, to ensure breweries in Australia and around the world can continue to make craft beer full of Australian hop character.”
The company’s first significant capital investment in land, plant and equipment in 20 years will see the area under hops increase by 50% and will double the processing capacity of Rostrevor Hop Gardens, ensuring HPA’s brewery partners can continue to grow with surety around their supply of HPA’s proprietary hops.
“HPA is a good news story in Australian agriculture; in the past decade we’ve transitioned from competing internationally at the mercy of a commodity based industry to thriving with a differentiated product offering through our proprietary hop varieties,” continued Lord.
The comprehensive expansion will occur in a number of stages across both farm sites with the first custom picking machine due in Victoria in mid-2015. HPA is in ongoing discussions with the Victorian government to support delivery of the project in full, which would generate a significant number of additional jobs in the Alpine Shire.
Notes to editors
Traditionally hop production was dominated by mainstream bittering hops – essentially a commodity based product which accounted for 100% of total sales for HPA.
HPA’s international success is a testament to an Australian agricultural business which has turned its fortunes around by using in-house research and development; to diversify and react to a change in the business environment, resulting in HPA’s hops now being supplied directly to craft brewers in more than 25 countries.
As part of a five year expansion plan, HPA has transitioned its production from 100% mainstream bittering hops in favour of their flavour and aroma proprietary hops. The 2015 harvest will be 80% proprietary hop production which is expected to increase to 90% by 2016.
HPA is a privately owned and independently managed Australian company, part of the Barth-Haas Group of companies; the largest hop trader in the world, founded in 1794.
The farms- Rostrevor Hop Gardens (VIC) and Bushy Park Estates (TAS) – are amongst the oldest continuously operating hop farms in the world. They’ve both been dedicated to growing hops since the late 1800s. Today, from these farms and selected growers, we grow around 80% of the hops grown in Australia, about 1% of the world’s production.
HPA’s modern flavour varieties are developed through our dedicated hop breeding program, established in the 1960’s. We strive to bring new flavour and the best quality hops to brewers in Australia and around the world.
- IBIS Craft Beer Production in Australia: Market Research Report March 2014 [↩]