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Hops And Barley Shortages Squeeze Beer Prices

  • MSNBC, Friday, January 25, 2008 11:16 AM
Just in time for the national drinking holiday known as Super Bowl Sunday, the main ingredients of beer--hops and barley-are in increasingly short supply. Prices for raw materials have leaped--by as much as 500% 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," says Peter Martin, of Brown's Brewing Co. in Troy, N.Y.

Microbrewers say 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% in the two weeks before the game. Larger brewers can more easily absorb the higher costs because they negotiated longer-term contracts when prices were lower, locking up supplies that are now too high for many microbreweries.

Brewers blame a variety of culprits. High demand for corn-based ethanol has persuaded many farmers to devote more of their fields to corn and less to barley. Rain in Europe and drought in Australia also withered crops.

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