Demand for ethanol leads to higher beer prices

by Daniel Garza

A shortage of barley has raised raw prices to the tune of 40 cents per pound in the past year.

In turn, smaller breweries in the San Francisco Bay area have had to adjust to keep up with the rising prices of necessary commodities.

Brew master Kent Wheat, of the Los Gatos Brewing Company, said it is getting more challenging for smaller breweries like his to obtain the ingredients to the perfect brew.

"As a smaller brewery, it's hard to find the hops that I need because some of the bigger guys have them," Wheat said.

Ron Manabe, Brewmaster for the Tied House, said that large-scale agricultural decision will ultimately affect bar tabs.

He referenced a spike in the production of corn, used commonly for gas-pump ethanol.

"It's become more attractive to grow corn, so farmers have made a choice to do that," Manabe said.

In turn, the essential, and less profitable ingredients for beer are produced in far lesser quantities, prompting a scarcity which will likely be seen compensated for on a bar tab.

Manabe said there would likely be a rise in beer prices at the Tide House, as much as 25 cents-per-pint.

The Los Gatos Brewing Company said it has already raised prices by about 75 cents.

Tied House patron Dan Hinkle said that, if the cost hike is subtle, he didn't think that the shortage would likely affect people's drinking habits.

"As long as it didn't go up like gas prices, I think we'd be OK with paying the extra 20 cents, 25 cents for a good beer."