The microbrewery industry in Kansas is growing faster than ever with demand higher than supply across the state. The Kansas legislature is attempting to respond with bills aimed at bolstering the microbrew and cider production business, but growing production will increasingly burden the already short supply of ingredients such as hops, barley, and fruits. Kansas farmers are in a unique position to capitalize on an industry that is not only booming in Kansas but across the nation.
Before Kansas farmers jump into hop farming, some considerations regarding the unique hop farm industry should be addressed. Hops are a fickle plant that often do not produce a significant crop until their third year. Forward hop contracting is a system that helps to protect the farmer making such a long-term investment. Forward hop contracts for Kansas farmers ensure that a brewing operation will purchase a set tonnage of hops produced by the farmer in the next 1-2 years. Having contracts such as this in place helps to protect the up-front investment made by farmers as well as helps the breweries plan ahead knowing a reliable hop producer is in their corner. These contracts need to be planned through completely with both parties; simply signing the contract produced by the other party may not protect your operation and investment adequately and reviewing the agreement with your attorney is highly advised.
Kansas has never been widely known for its fruit harvest, but changing cider production laws may boost the niche Kansas fruit farming market. Cider is produced from the fermentation of fruit and a new Kansas law currently going through the legislature states that cider produced in Kansas must contain at least 30% local Kansas fruit. Like hops, most fruit crops are long-term investments such as orchard trees or grape vines. Acquiring and expanding an existing orchard or vineyard may be a better choice than starting from scratch. When your existing farm operation merges or acquires existing fruit production farms, the merger or acquisition needs to be structured carefully to protect the individual interests at play. Taking on debts or liabilities of an existing company is a large undertaking that can leave your business exposed to lawsuits or unplanned monetary obligations.
The brewery and cider industry in Kansas is a great opportunity for Kansas farmers to respond to the needs of a new industry and support the Kansas economy. Keeping production local is a benefit to the farmer, brewer, and consumer as well as the state as a whole. If you have questions or concerns about expanding your agriculture operation to support the Kansas microbrewery and cider production industry, call The Law Office of Nathaniel Gilbert for an absolutely free consultation to help address your concerns and see if the move is right for you. A qualified attorney in your corner can make all the difference in a successful venture.