It was an offer they couldn’t refuse.
Two years ago, Kevin Sich of Rahr Malting Canada called six Alberta growers and offered them one heck of a deal: a three-year contract to grow malt barley with a guaranteed premium price, protection against any rise in input costs, and the opportunity to ally themselves with one of the fastest-growing beer companies in the U.S.
It didn’t take long to say ‘yes,’ recalls Brent McBean, one of the original six (now expanded to 12) farmers in the Chinook Arch Barley Grower Program.
“It’s been a fantastic opportunity and, trust me, I feel completely fortunate that Kevin asked me to be part of it,” says the Strathmore-area producer.
“We have a strong relationship with Rahr and now we’re getting the chance to develop one with the end-user of our malt. That’s the part I find very exciting.”
Relationship is a word frequently used by those in the program to supply California-based Lagunitas Brewing Company, which has gone from a start-up to the fifth-largest craft brewer in the U.S. (and 13th overall) in just a decade. The brewer, which has a similar deal with its hops growers, wanted to do the same with malt farmers following the end of the wheat board’s monopoly on barley exports.
It fell to Sich, manager of Rahr Canada’s grain department, to issue the invitations.
“We wanted long-term, committed growers who have had good success at growing malt,” he says. “When it comes to growing malt, these guys are sure bets.”
The key word is committed. Sich says that characteristic is common among the farmers he deals with and his biggest challenge was having too many excellent producers and not enough spots in the program.
“If I’m at a growers’ meeting and say we have a new variety and we want to do some trial testing of it, we’ll pretty much have 30 or 40 hands go in the air,” he says.
“The guys will say, ‘We’ll buy seed, pick it up from wherever, and grow it for you.’ I think that shows the sort of relationship we have with each other.”
The chance to try new things and learn is what really makes the Lagunitas deal special, says Tyler Schultz, who grows about 1,200 acres of malt on his family’s farm near Camrose.
“Hopefully as new opportunities arise – whether that’s new varieties or other programs, we’ll get the first chance to participate,” says the 31-year-old.
“It’s also about establishing trust and understanding each other. We all need to make a profit, but when you better understand each other, you can find ways to add value.”
It’s a view echoed by McBean, 49. During the 18 years he’s sold to Rahr, he’s grown “just about every variety that’s come through the pipe” and eagerly participated in pilot projects such as traceability and special programs for specific brewers.
“I’ve never liked being a ‘commodity producer,’” he says. “I’m thrilled to know my end-user and to know that I’m growing something for someone.”
Rahr has invited him to its malt house in Alix in central Alberta, sharing details of how it processes his grain and explaining how its specific attributes affect the malting process and the quality of the end product.
“I probably know too much about their business,” McBean says with a laugh. “But we’re partners. We’re open and honest with each other and that benefits both of us.”
“We view the farmers we buy from as our customers, just as the brewers are,” add Sich. “We work with them, we put a lot of trust in them, and they do the same for us.”
The same thing is now happening with Lagunitas. The company invites the malt growers to its brewery north of San Francisco each year and company owner Tony Magee (a prolific tweeter and champion of “de-commodified pricing”) proudly boasts of his company’s relationship with them.
“These relationships aren’t everywhere,” notes McBean. “Building a relationship with a multinational is pretty tough, so you need to look around. It’s a bit like dating – it can be hard to find someone, but you need to find people who want to have a relationship and see the value in that.”
That might sound touchy-feely, but it’s just smart business, says Schultz.
“I’d say this is a very entrepreneurial type of group,” he says. “They want to try new things because they take a long-term view and are willing to pursue opportunities. They might not pay off in the short term, but if you develop those relationships, they will in the long run.”
Attitude is everything, adds McBean.
“You have to invest time, you have to put yourself out there, and you have to know your strengths and what you have to offer,” he says.
“There are opportunities everywhere. But it all gets back to relationships. That’s the key.”