Washington family hops farms show resilience in a boom or bust industry

Moxee and Wapato are two small farming towns in a fertile part of south-central Washington called the Yakima Valley. Hops were first planted in the valley more than 150 years ago, and Dolores’s family began growing them in 1907. The Yakima Valley sits in the latitudinal sweet spot for growing hops: The crop flourishes to such a degree that, since about 1930, the region has been considered the hops-growing capital of the world. 

While other agricultural commodities became heavily corporatized in the 20th century, a smaller and less predictable market has kept hop farming among families. Green Acre is one of dozens of farms that have stuck with it, generation after generation.

However, despite its successes, survival has never been consistently easy for Yakima’s hops-growing community.

“It’s always tough,” Gary says. “I can remember the good years, ’80, ’92, 2000. It’s like every 10 years.”

The in-between years determine whether a family will be able to stick it out. 

“There used to be 500 growers in in the ’50s,” he says. And now? “We’re down to 60.”

Agriculture’s Comeback Kids

Cycles of boom and bust have regularly brought Yakima’s hops industry to the brink of collapse, whether due to pestilence, Prohibition, or price fixing. The families who remain have survived thanks to resilience, adaptability, and, to a great degree, cooperation.

We only have to look back to 2006 to find the hops industry in crisis. However, what happened next stands among the all-time great comeback stories in the history of American agriculture. 

The hops market had sustained a decade-long down cycle, as demand hit a generational low. According to trade association Hop Growers of America, what had been a $135 million industry in 1995 lost more than $30 million in annual value by the beginning of 2006.

Nowhere was the impact felt more than the Yakima Valley, where roughly 75 percent of the hops in the U.S. are grown.

Jeff Widdows, a Marsh McLennan Agency broker and agribusiness specialist, works with all manner of farms in the Yakima area, which may have a bigger reputation for growing America’s apples. However, while fruit tree agriculture tends to attract venture capital, the local hops business remains in the hands of the families who built it.

“They’ve grown up together. Their dads grew up together. Their grandfathers grew up together. It’s more family oriented than any industry I’ve ever seen or worked with, and I feel very fortunate to be a part of it,” Widdows says. 

The closeness made the ten-year downturn all the more distressing. Some families survived by repurposing hop fields as vineyards or orchards.

Green Acre invested in wine grapes, cherries, apples, pears, and mint. Other farms let go of hops acreage or even sold their farms altogether.

In the nearby town of Toppenish, Perrault Farms went into foreclosure.

Established in 1902, Perrault Farms traces its origins to the Moxee Company, a real estate operation backed by investors including the inventor of the telephone, Alexander Graham Bell. From the end of the 19th century, the company marketed 50-acre parcels of irrigated land in Moxee, touting its fertile soil and sunny climate to lure farmers from across the Midwest. Many who responded hailed from French-Canadian families, including Alberic Perrault, who’d recently emigrated to Minnesota.

“When [Alberic] was about 18 years old, his family sent him out here,” says his great-grandson Jason Perrault, CEO of Perrault Farms and a fourth generation Yakima Valley hop farmer. “He established that first homestead, and the rest of the family, including his mother and father, followed.” 

Alberic and his wife Salome started growing hops in 1928. In 1969, their son Bernard bought his own land. He and wife June planted the first plots of what would become the family farm in Toppenish.

Jason’s father, Steve Perrault, was running the farm in 2006 when the Yakima Herald issued a public notice that the foreclosed farm would be sold at auction. “It wasn’t just us,” says Jason. “It was industry wide. That extended term of low market prices, that put a lot of pressure on a lot of the family farms. We just about lost the farm completely.”

In fact, the same circumstances that put the farm in jeopardy gave the family a chance to turn things around. The hops market was so dire, no one bid on the property. When the farm didn’t sell, the Perraults were granted one more year to get right.

Jason insists the family never lost hope. 

As it turns out, just around the corner were the aromatic fruits of a long-term investment Steve Perrault and a handful of fellow farmers made in the late ’80s.

Cutting Out the Middleman

Hops, from the plant humulus lupulus (“wolf of the woods” in Latin), grow in clusters of dense cones that resemble small artichokes. They’re typically the last ingredient added during the production of beer. Each hop cone is rich in bitter alpha acids, which are added by brewers to balance against the malt sugars that would otherwise make beer taste cloyingly sweet.

Alpha acids grow in higher or lower concentrations, depending on the variety of hop. However, as the brewing industry evolved, the massive companies that dominated the market, such as Anheuser-Busch, turned to using hop oil extract. That meant harvested hops needed to be shipped somewhere for processing; businesses that produced the extract then sold it to the breweries, creating a middleman.

“Back then, the brewer and the grower rarely interacted,” explains Jason Perrault. “You had a typical dealer network, where the business model was buy low, sell high. The larger the disconnect between the grower and the brewer, the more profitable their business would be.” 

This proved extremely hard on farmers, particularly due to the amount of labor needed to harvest the plant each summer.

“Back in the ’30s,” Gary Morford says, “they picked hops by hand. At the American Hop Museum [in Toppenish], you could see an old poster: ‘Wanted 10,000 hop pickers.’” Support arrived by train from all over the country during harvest season and virtually everyone in the valley would be put to work.

Even with modern farming advances, the process takes a lot of hands. Hops are no less labor intensive during the spring planting season. A climbing plant species, they grow up bines that wrap around a vertical host. For hops farmers, that means twining young plants to grow up along 18-foot lengths of string, which are held taut by 18-foot-tall trellises. Twining is work that still can only be done by hand. Hops farmers were consistently feeling the squeeze between high operating costs and suppressed market value.

A coalition of farmers and the breweries themselves fought to relinquish the hold of third-party dealers, but the biggest push would come from Anheuser-Busch itself, when it launched its AB Direct hops buying program and established a presence in the Yakima Valley to work directly with growers. Anheuser-Busch’s arrival would open up a new era of cooperation between Yakima’s hop farmers, but it wouldn’t be big beer companies that would pull them out of that ten-year slump. 

Fueling the Craft Beer Boom

For a long time, Green Acre, and most of the valley farms, focused on one type: cluster.

Cluster hops was virtually the only variety planted in the U.S. through the 1970s. In addition to those bittering alpha acids, it possesses another favorable quality brewers look for: aroma.

Pine, citrus, tropical fruit. Ask any craft beer drinker about the hops in his or her glass, and you’ll hear of a succession of flavors and aromas described with the earnest reverence usually reserved for wine or coffee. 

In the late 1980s, Steve Perrault joined friends and fellow growers Tom Carpenter (of Carpenter Ranches) and Mike Smith (of Loftus Ranches) to form Yakima Chief Hops. Over the next decade, Yakima Chief would bring ten other farming families into the fold, pooling enough capital to build a hops processing plant in Yakima Valley. With that, they could claim further control over distribution of their product and optimize their returns—and, crucially, invest in hop breeding.

They brought in Charles E. Zimmerman, a renowned research scientist who’s credited with cultivating a new generation of aromatic hops that fueled a burgeoning craze for hop-forward pale ales, and developed a separate operation to cultivate new varieties of hops. Initially called Select Botanicals Group, its original aim was to breed a hop that wouldn’t require any more resources to grow, but would yield a significantly higher level of alpha acids. The effort led to a hop called Simcoe.

The experimental hop was officially released in 2000. There was only one problem: “When we first released Simcoe, we could hardly give a pound away,” Jason Perrault recalls.

Then, appreciation for the new hop arrived from an unexpected source. “Around 2006, craft brewers started to use Simcoe,” Perrault says. “It had this incredible aromatic profile that was making some really great IPAs.” 

India Pale Ales had become the headliner of a bona fide craft beer boom, and Simcoe delivered the boldness and complexity hopheads craved.

A number of craft brewers had started working with Simcoe as early as 1999, before it had even been named. Russian River Brewing Company used it in its Pliny the Elder, one of the most celebrated IPAs in craft beer history. America’s giant lager breweries may not have appreciated Simcoe, but the craft brew world was singing its praises.

In 2003, Select Botanicals—now rebranded as Yakima Chief Ranches—partnered with another private hop breeding company, John I. Haas, Inc., to form a new entity, The Hop Breeding Company. It went on to create the two most popular hops of the last decade: Citra and Mosaic. Having learned the hop breeding science from Chuck Zimmerman, Jason Perrault serves as one of two head hop breeder.

Though the shift to aromatic hops looks like a no-brainer decision now, it would have been less obvious at the time. However, the craft brew industry was poised to explode.

Consider this: In 1996, there were fewer than 1,000 breweries in the United States. Today, the number approaches 10,000. 

By 2006, and nearly all U.S. breweries had shifted their focus to new and aromatic hops. This, coupled with a disastrous European growing season that would choke the global hops supply allowed Yakima Valley growers to finally get a leg up.

“The price spiked, and we were able to, at that point, lick our proverbial financial wounds,” Perrault explains.

These events didn’t just save Perrault Farms and the Yakima hops industry—hop farmers entered a new Golden Age. The demand for exciting new hop varieties continued to rise, and in Yakima, this growth translated to peak seasons planting hops on more than 40,000 acres and seeing prices reach $6 per pound, as tracked by Hop Growers of America. The organization also recorded a drastic shift in which type of hops Yakima was growing. In 2007, roughly two-thirds of its output were alpha hops. By 2017, about three-quarters of its crops were aroma hops.

And the annual value of the hops industry has since ballooned to more than $600 million. 

“We’ve seen an unprecedented period of time here—a perfect storm of craft beer, and a beer drinking consumer that loves flavor, and novelty, and creativity,” Perrault acknowledges.

With modesty characteristic of Yakima’s hop farming families, he adds, “We’ve been able to capitalize on that success and build some stability that hopefully will carry us forward for at least another generation.”

Planning For the Future

Even amid the boom, Yakima’s hop farmers remember the lessons of those bust years and have found myriad ways to reinvest their profits to brace against the next down cycle. 

“You don’t want to be doing ten years of not updating, because then you’re really behind,” explains Gary Morford. Even as the lifelong farmer reflects on the history of his family, and of his homespun industry, he’s always thinking about the future. “You’ve got to be on the forefront,” he insists. “It never stops.”

That can mean upgrading equipment to increase growing capacity, updating irrigation practices to hedge against water rationing, or finding new hop varieties to grow. Green Acre produces upwards of 20 types these days.

Back in 2000, the Morfords invested in a hop-breeding operation. They partnered with another multigenerational Yakima hop farm, Roy Farms, to form what is now called Latitude 46. It’s been responsible for the popular aromatic hops Azacca and Summit, plus a newer variety called Adeena.

More recently, Latitude 46 has adjusted its focus. Now, it’s developing varieties ready to face challenges threatening hop farmers. That means creating disease resistant hops and varieties that can adapt to different growing regions and climate conditions. Similar efforts are being made by The Hop Breeding Company. 

The folks at Green Acre are optimistic about the future, both of the family farm and the Yakima Valley.

“I’m usually a guy that sees a glass as more than half full,” says Morford. “Andrew’s got two sons that are pretty young, so we’re a long ways from the fifth generation. But we hope they’ll take care of the soil and land, as we preach. And we’ve got to take care of it—and take care of the people in the community.”

Learn more about Marsh McLennan Agency’s Agribusiness Services.

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