After 11 years in the business, Wells is still more than happy to yak about beer and what he’s got brewing — like the Pilsner made with Saskatchewan craft-malted barley he has in process.

“So far it’s tasting awesome,” he said.

Rosthern, Saskatchewan, is the closest Wells can get to local craft malt right now. Wells said he used to source from Malteurop, which has a Winnipeg location, but had to take his business elsewhere because the malt wasn’t meeting his requirements.

It turns out, making local beer out of local ingredients isn’t easy despite tonnes of malt barley grown in Manitoba each year.

Why it matters: Craft beer consumption is on the rise. Manitoba farmers looking to diversify may find opportunity in supplying the growing demand for local ingredients.

A study from the University of Manitoba found that while local brewers see value in sourcing ingredients locally, ingredients like barley malt and hops are almost entirely brought in from out of province. As a result, the surge in craft beer sales isn’t contributing much to rural economies.

Kurtis Ulrich, a natural resources student, presented the findings at a symposium at the University of Manitoba on June 26. The research is part of a body of studies looking at innovations in small-scale food systems and farms, and the links between farms and cities. Ulrich worked alongside lead researcher Iain Davidson-Hunt, and Hannah Muhajarine.

Ulrich told the symposium that they found two main roadblocks between brewers and Manitoban ingredients: a lack of “craft” farmers producing ingredients to brewers specifications, and the lack of a Manitoba-based, small-scale, craft malting facility.

Ingredient sources

While overall beer consumption has actually dropped in Canada, the percentage of craft beer sales has risen, according to Agriculture and Agri-Food Canada.

There is no exact definition of “craft” when it comes to beer. Ulrich said craft beer entailed a handful of key values: the quality of ingredients, local ownership, local manufacture and distribution, product diversity, brewing creativity, and hands-on, small-batch production.

In 2018, there were 11 craft breweries in Manitoba.

Besides water, barley and hops are the main ingredients of beer. In 2018, Manitoba farms produced just over 500,000 tons of barley, according to the Canadian Grain Commission. Just under half of that was malt barley.

According to Ulrich, local brewers aren’t buying that barley. Of the brewers he spoke to, all but one were sourcing from large companies like Brewers Supply Group, which is owned by Rahr Malting Co. Rahr has malting facilities in Alberta and Minnesota.

Wells said he buys from Country Malt Group, also a large company with Alberta and Ontario locations.

Most hops used in Manitoba come from Oregon’s Yakima Valley, said Ulrich. Manitoba has three commercial hop growers, but these do not produce enough hops to supply all the local brewers.

Wells said he buys hops from a Boissevain-area producer when he can, and has collaborated with that producer to make specialty batches of beer.

“My general theory is I’ll do Winnipeg, if I can’t do Winnipeg I’ll do Manitoba, if I can’t do Manitoba I’ll do Canada before I go out,” Wells said.

Why source locally?

For Chris Wararuk, local ingredients mean keeping money in the local economy.

“You know, for a local craft brewery to talk about local and then not buy local is kind of like an oxymoron,” he said.

He and his brother Lawrence Wararuk own Farmery Estate Brewery in Neepawa. They grow their own barley and hops within miles of the brewery and employ locals. They can their beers and distribute across Manitoba and Ontario.

The brothers owned a restaurant in Winnipeg, prior to Farmery. They found it difficult to source local food, like beef. They found that the restaurant food suppliers didn’t source from farms in the area because they needed meat from federally-inspected facilities.

“That was, like, baffling for us,” said Lawrence Wararuk. They ended up making their own arrangements with farmers and small butchers.

“It not that there isn’t a customer that wants to buy local, it’s that the supply chain doesn’t exist,” he said, adding it wasn’t dissimilar for local barley.

“Our barley that we grow here in Manitoba gets shipped to another place — even if it gets shipped to, like, MaltEurop — that malt gets eventually shipped to places like Burlington in Ontario to brew Budweiser that we bring right back to Manitoba,” said Lawrence Wararuk.

Farmery has an arrangement with Malteurop to malt their barley in separate batches to preserve it’s identity.

Wells and the Wararuk brothers said that craft beer has potential to differentiate itself by provide regionally-identified flavours, or terroir, from locally grown barley. This is not unlike regional wines — similar varieties of grapes, but different results based on regional growing conditions.

“Now it’s not just locally brewed but it’s actually a local flavour,” said Wells. “It adds to the story, it adds to the local economy. There’s nothing bad about it.”

“A large part of the craft beer component, part of the whole movement, is that it’s local,” said Wells.

He said craft beer drinkers are generally willing to pay a little more for something produced near home. If they knew the barley and hops were also local, that would be a bonus.

“The story to me is the bonus, right? The fact that it’s local, the quality is good, the local economy is boosted by it. To me it’s a no-brainer,” Wells said.

Barriers to production

What’s missing are the processors and producers. Manitoba does not have a craft malter that would allow brewers to know exactly where their malt barley comes from.

Peter Watts said he’s had Manitobans express interest and receive training at the Canadian Barley Malting Technical Centre in Winnipeg, which he manages, but so far no one has pulled the trigger.

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Matt Hamill and his brother Joe Hamill started Red Shed Malting in Penhold, Alberta about five years ago. They wanted to get their dad’s malt barley into some of the beer they were brewing at home.

“Craft beer was blowing up,” Hamill said.

Brewers were looking for ways to differentiate themselves, and the Hamill brothers knew local craft malt would be one way to do that. Still, it was “kind of a leap of faith.”

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Now they have the capacity to produce about 200 tons of base malt per year, which Hamill said was a fraction of a per cent of one of Canada Malt’s plants. They produce base and specialty malts and have partnership with several small breweries in Alberta.

Hamill, his brother, sister-in-law and parents put in many hours at the malt house, but only one of them draws a wage. He said they’re trying to build up so they can do it more full time.

“It’s got to be a labour of love,” said Hamill.

Hamill sources most of his barley from his father’s farm. Watts said he sees this as the most viable scenario for a small malting facility — as a way to add value to an existing farm. He adds it’s a complicated process to start up, and would take investment in training, not just equipment.

Randy Tye farms six acres of hops near Boissevain, and plans to expand to 15 acres. He supplies brewers in Winnipeg, generally for small or specialty batches of beer. He said local brewers are happy to buy his crop but he can’t produce all they need.

He said the other commercial grower in Manitoba has a smaller capacity than he does. Farmery is the third hops producer in Manitoba, but they produce for themselves.

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Tye said hops are labor-intensive and take a lot of cash to get into. It’s a long-term commitment, like an orchard.

“You’ve really got to want to do it.”

He’s purchased a mobile harvester and plans to offer custom hops processing and packing to help new producers gets started. He said to be successful the product must be consistently of good quality and reasonably-priced.

Chris Wararuk acknowledged that it would be cheaper to buy hops instead of growing them. “But doesn’t help our economy,” he said. To make up for the increased price of production, they just plain make and sell more beer.

Stiff drink competition

In the liquor store, craft beers are not just up against other Manitoban breweries, but brewers from other provinces — provinces that help their craft beers compete in the marketplace.

“Manitoba seems to lack the same clear policy goal and environment to support entrepreneurs in growing a local/regional food system, which, as reflected in some of the interviews makes craft brewers, feel that there is not a government commitment to their role in regional development,” said Iain Davidson-Hunt, the lead researcher on the University of Manitoba study.

Davidson-Hunt said the theme of policy barriers came up in the study. When they reviewed what the province had to say, they found little relevant policy — whereas in Ontario, the government had policy in favour of local food, and had contributed funds to craft breweries in the past.

“I would think that a policy environment that includes a focus on local food broadly and then craft beer within that framework can then open space for funding programmes to invest in building a local/regional food system in order to help it grow. Without that it may be difficult to obtain funding to start a craft malting enterprise in rural areas,” said Davidson-Hunt.

“It seems that Manitoba lacks a clear idea of how local food fits into regional development strategies,” he said.

The Wararuk brothers said that to keep the value and jobs in Manitoba, the government needs to step up or people will continue to buy what’s cheapest.

“The government has to recognize that supporting that critical piece is really the missing piece and tey have to be competitive with other jurisdictions,” Chris said.

Lawrence added that Manitoba has a film tax credit that he said subsidizes Hollywood producers to film in Manitoba. “Why can’t there be some incentive to encourage the drinkers of Manitoba to drink local?”

The Manitoba Co-operator contacted the province for comment on craft brewing and local food incentives, but at the time of writing had not received a reply.

Wells said that in his experience, local products can compete on taste and support for home-grown food.

He converted his wife’s stepdad from mass-produced beer to craft beer years ago. “I remember him dumping [the massed-produced beer] out, you know? He’s like ‘this tastes like nothing!’ and he went and grabbed one of my beers.”

It’s often a matter of not knowing the beer existed, Wells said. People just need an opportunity to try it.