Craft Whiskey Brings Profits to a Forgotten Corner of U.S. Barley

(Bloomberg) -- A growing interest in U.S. craft whiskey is helping make money for barley growers who previously planted the crop without the aim of making a profit.

Dave Hedlin, a third-generation farmer in Washington state’s Skagit Valley, used to grow the grain largely to improve his soil and break crop-disease cycles after the harvest of vegetables such as cabbage, spinach and beets.

Craft Whiskey Brings Profits to a Forgotten Corner of U.S. Barley

Now, he’s raising it in collaboration with Skagit Valley Malting and Seattle-based whiskey maker Westland Distillery, which is owned by Remy Cointreau SA. Hedlin’s move is part of a trend that has boosted barley plantings in Washington by 12% to 95,000 acres this year, marking a nascent revival after a collapse from peaks of as much as 1.2 million in 1985.

That’s tied to a rise in demand for U.S. craft whiskey, sales of which rose 25% to 3.3 million nine-liter cases last year. That outpaced overall whiskey sales growth of 8%, according to data from IWSR Drinks Market Analysis. Craft varieties make up about 10% of the total volume.

Catering to craft-beverage makers has allowed Washington farmers to add “value to a part of the rotation where there’s literally no value,” said Stephen Jones, a wheat breeder and director of the Bread Lab at Washington State University in Burlington.

Barley had fallen out of favor in Washington because it was difficult to compete with farmers in the U.S. Plains and Midwest who sought to maximize yields or raise the grain with the broadest level of taste to appeal to the biggest malters. But with the craft industry, the focus is on determining which grain might produce the most interesting flavor for whiskey.

Craft Whiskey Brings Profits to a Forgotten Corner of U.S. Barley

Spirit-makers who prize locally grown and sustainably raised barley are willing to pay a premium of double or triple the price of grain used in animal feed. While one variety called Alba initially was developed for use as feed, it has notes of molasses and peanut butter cookies when expressed in the whiskey, said Matt Hofmann, the master distiller at Westland Distillery. Part of the sustainability goal in agriculture is making sure farmers can earn a living, he added.

“I used to jokingly say we grew grains for fun and occasionally for profit,” the grower Hedlin said by phone. Now, whiskey makers and malters “are re-inventing things,’’ he said.

©2019 Bloomberg L.P.

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