3 Ways Climate Change is Already Impacting the Beer Industry

written by Lukas Reinhardt

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Beer is one of the oldest prepared drinks known to humans, with its origins dating back 5,000 years. Today the global beer industry is valued at a staggering $593bn and is projected to grow to $685bn by 2025. Despite this optimistic growth forecast, a changing climate is brewing up a storm for beer producers.  

Beer is made up of three basic ingredients: barley, hops, and water. With an expanding beer industry, the demand for these ingredients is expected to rise. However, in recent years the quantity as well as quality of these ingredients has slipped, largely due to an increase in frequency of extreme weather events. Below is a summary of how climate change is already impacting the core ingredients of the world’s most popular alcoholic drink.

1. Barley

The hot and prolonged dry weather conditions this summer have led to widespread cereal crop failure across Europe. In Germany barley yields in 2018 are expected to drop by 18.8% down from 2017. An industry expert interviewed by Reuters predicted an EU shortage of 500,000 tonnes in malting barley this year alone. In the US state of Montana, a similar situation unfolded last year when flash droughts reduced both the quality of barley as well as the total yield. With a decrease in the availability of high quality malted barley on the market the price has gone up. Bloomberg reported that in France the price of malted barley has gone up by more than 35% since April. 

2. Hop

Similar to barley, hop yields overall have also suffered in the last years due to unfavourable weather conditions. In 2015, Germany had one of the biggest losses in hop yields for decades, falling 26% from the year before due to high temperatures, extreme hail and lack of rain. In the US of the same year an above average warm winter meant no snowpack formed in the Yakima Valley, this caused the soil to dry up by Spring and led to drought conditions in the biggest hop growing region in the US. To combat the drought an unsustainable extraction of groundwater to irrigate the crop was required. Together, the US and Germany make up over two thirds of global hop production. With climate scientists at the IPCC predicting an increase in the frequency of extreme events such as floods, heat waves, droughts, and storms, shocks to the global hop market, such as in 2015, will only get worse.

Unfortunately, it isn’t only the volatility in yields that’s giving the beer industry a headache. The quality of hop is also crucial in shaping the complex flavours found in beer. Unfortunately, increasing temperatures have been found to reduce the alpha acid content in hops – a component that determines the quality of the crop. On top of this, rising temperatures in hop growing regions will also lead to more favourable conditions for pests and diseases. 

3. Water

Beer is made up of roughly 93% water. However, breweries don’t only need water for the final pint of beer - water is required throughout the whole process. On average around 4 litres of water are required during the brewing process to produce 1 litre of beer. With hotter summers and less frequent precipitation, breweries could be facing water shortages in the future. In fact, breweries in California have already struggled with water shortages over the last years, with the region facing one of the most severe droughts on record in 2014. Last year protesters in Mexico even demonstrated against the opening of a large US brewing facility in an increasingly water scarce area of Mexico. 

Water shortages mean breweries will need to find alternative sources, potentially switching from surface water to ground water sources. Not only will digging for ground water sources raise the cost of production. However, ground water is generally more mineral heavy, which can affect the fermentation process during brewing and alter the taste of beer. The head brewer at Lagunitas Brewery in California, Jeremy Marshall, told NPR, “it would be like brewing with Alka-Seltzer”.  

How the Beer Industry is Addressing Climate Change

In 2015, a group of 24 breweries came together to sign a Climate Declaration. The declaration called for strong action to reduce the environmental footprint of the beer industry. Over the last years, more and more breweries around the world have increased their efforts to reduce their water usage, switch to renewable energies, and source their ingredients from local suppliers. However, despite these efforts, the beer industry will continue to face the challenges of a changing climate.      

Lukas ReinhardtComment