Local Resilience in a Volatile World: Building a Stable Supply Chain for Craft Brewing

As the U.S. craft-beer market matures, the headwinds are getting stronger. Brewers are operating in a narrowed, more competitive field in which younger consumers are drinking less and alternative beverages such as canned cocktails and cannabis-based products are carving out market share. Amid these shifts, one variable has become increasingly difficult to control: the ingredient supply chain.

Extreme weather events, global conflicts, tariff fluctuations, and trade disruptions are pushing raw-material availability into uncharted territory. The core building blocks of beer—malt, hops, and yeast—have been subject to sudden price shifts, quality issues, and shipping delays. Brewers already navigating fast-changing market conditions are now having to jump through hoops just to track down ingredients.

Sourcing malt, hops, and yeast locally can make all the difference in building a stable, transparent supply chain.

A Precarious Global Pipeline

Weather volatility has been especially hard on barley and hops. In 2021, a severe drought across the Canadian and U.S. Northern Plains cut spring barley yields by about 30 percent, leading to what the Brewers Association described as “the lowest level of available barley-malt supply on record.” U.S. hop production, too, has swung year to year, dropping 16 percent in 2024 because of drought conditions and acreage reductions.

Global tensions, particularly the war in Ukraine, have further destabilized international grain markets. Prices for malting barley in Europe soared more than 50 percent in 2022, putting additional cost pressure on U.S. brewers who rely on imported malt. Meanwhile, Alberta and Saskatchewan barley has long helped balance U.S. supply. Any disruption in cross-border trade with Canada because of soured relations or rising tariffs will have a sizeable and immediate effect on the craft-brewing industry.

In short, today’s ingredient landscape is volatile, fragmented, and difficult to forecast. When brewers can’t predict what their inputs will cost or whether they’ll arrive at all, it’s hard to run a business.

A Shift to Regional Resilience

To manage this volatility, more brewers are turning their attention closer to home. Local sourcing not only shortens supply chains and reduces exposure to international disruptions; it also improves transparency, reduces emissions, and allows for better collaboration with growers and suppliers.

We built Proximity Malt on the idea that regional malt production can reduce risk while improving access and quality. Rather than relying on imports, we develop sustainable supplies of malted barley near the brewers we serve. Grains are locally grown and locally malted to the standards of U.S. craft-style brewers and distillers. Sourcing and malting locally provides a dependable, scalable, and cost-effective alternative to global supply.

“The traditional malted-barley supply chain, with touchpoints at ports, switchyards, and truck depots, has so much tied up in logistics costs—not to mention today’s currency and political risks,” says Dale West, CEO of Proximity Malt. “We started our business to bring a secondary supply chain closer to the breweries.”

This approach has resonated with breweries across the United States that are seeking to insulate themselves from global shocks without compromising quality.

Next-Level Sustainability

What if a sustainable supply chain could be both reliable and regenerative? Our ReGenMalt is a new market class of malt products sourced from U.S. farms invested in regenerative agriculture—a system of farming principles that rehabilitates the ecosystem and enhances natural resources, rather than depleting them.

These practices generate quantifiable environmental impact year after year. Crops are more insulated from extreme weather. Water resources go farther. Topsoil is held in place because living roots are always present in the soil. Nutrients are retained instead of being leached into surrounding areas or groundwater. And, in time, synthetic chemical rates are reduced.

“ReGenMalt is a great way to add sustainable value to your beer by reducing the use of finite resources, which in turn reduces cost of goods sold,” says Landon Swanson, head brewer at Pueblo Vida Brewing in Tucson, Arizona. “This program helps reduce soil inputs, lower transportation costs, and improve overall soil health, which will help provide stable harvests and save brewers money in the long term.”

Pueblo Vida was one of 54 breweries that participated in Proximity Malt’s ReGenMalt program last year. In one year, these breweries collectively:

• Prevented 1,600 metric tons of soil erosion
• Reduced greenhouse gas (GHG) emissions by 288 metric tons
• Sequestered 215 metric tons of soil carbon
• Prevented 1.1 metric tons of nutrients from leaching into water

ReGenMalt works with the Eocene Environmental Group, a third-party environmental stewardship organization, to capture on-farm data. Participating breweries receive Certificates of Data Allocation (CODAs) verifying environmental impact, as well as narrative offset statements that can be used in marketing products directed to customers or to suppliers downstream in the marketplace.

A 2022 poll by The Conference Board and The Harris Poll found that 60 percent of U.S. craft-beer consumers are willing to pay more for sustainably produced beer. When brewers can credibly show that choosing a pint brewed with ReGenMalt versus conventional malt makes a difference—offsets the emissions of charging a cellphone 15.5 times, for example—it creates added value and affects future purchasing decisions.

“We made the switch to ReGenMalt because sustainability is in our DNA,” says Patrick Jose, head brewer at Carver Brewing in Durango, Colorado. “ReGenMalt makes sustainable and delicious beer while supporting family farms and the soil we live on.”

“We’ve been using ReGenMalt for over a year now as our base barley, and it’s been a win all around,” adds Jake Miller, cofounder of Heirloom Rustic Ales (Tulsa, Oklahoma). “It’s allowed us to maintain our high brewing standard while also continuing to be stewards of our watersheds and farmlands.”

Photo: Studio Gi / stock.adobe.com

Strength in Diversification

Part of building a more resilient supply chain is having more options. At Proximity Malt, we have expanded our product offerings over the past few years to include more malts, as well as hops, yeast, and brewing analytics. This streamlining offers multiple benefits: fewer vendors, fewer shipments, and fewer surprises. It also opens the door to more cohesive ingredient strategies, where brewers can dial in their recipes with a full understanding of how inputs interact both in the brewhouse and on the balance sheet.

“We’re trying to be the best partner we possibly can for our brewers,” says Zach Gaines, commercial director of Proximity Malt. “That means creating an environment where there is less volatility so brewers can focus on what they do best.”

Proximity Malt is one of the only regional maltsters offering a variety of roasted malts. In addition to a full portfolio of ReGenMalt and conventional malt products, we aim to be a one-stop partner for brewers with:

• All-natural flavored malt to replace messy purees and syrups. Flava-malt is a clean-label flavor alternative that requires no refrigeration and is easy to add. Brewers can skip a step for greater efficiencies and cost savings while still achieving vibrant flavors.
• Hand-picked, locally sourced hops from Hop Head Farms with true-to-type flavor and aroma.
• World-class yeast from Lallemand, conveniently packaged and immediately available.
• Actionable brewing data to stretch malt farther, reduce waste, and ensure consistent quality. Grist Analytics provides detailed production metrics to empower data-driven decision making.

Future-Proofing Craft Brewing

The supply chain challenges facing craft breweries aren’t going away. The brewers who weather the next decade successfully will be those who build strong partnerships—with local suppliers, with their customers and communities, and with the land itself. Local sourcing is here to stay as a long-term strategy for flavor, sustainability, and resilience. To learn how we can help you future-proof your business, contact our Proximity Malt team.