Despite being home to some truly progressive, forward-thinking and ecologically conscious folks, the beer industry at large is far less sustainable than you might think. From water usage concerns to the pervasive-yet-dubiously recyclable plastic PakTechs, craft beer still has a long way to go to be truly sustainable.
One of the biggest hidden roadblocks to a greener craft beer future has been the industrial waste and emissions created by the companies that provide craft brewers with their malts, hops, and other ingredients. Realizing that they had a chance to affect major change within the industry as one of the nation’s largest ingredient providers, Shakopee, Minnesota’s own Brewers Supply Group [BSG] began rolling out a new sustainability initiative this spring: Recycling malt bags.
We chatted with BSG’s Domestic Logistics Manager Jordan Srock about the new program, BSG’s history in the craft beer industry, and more.
Beer Dabbler: While most beer fans can name the ingredients that make beer, a lot of them don’t understand where those ingredients come from. Give us a bit of background on BSG.
Jordan Srock: It’s tough to talk about BSG, Brewer’s Supply Group, without talking a little bit at least about Rahr Malting as well. That really is where we come from, we get our start.
We are two separate companies now, but our parent company is Rahr Malting. We joke that they’ve been around forever, they literally have been around 175 years this year. Rahr has been making malt for brewers and distillers since 1847 and has been a supplier to a number of historical and legacy breweries as well as craft brewers.
Then, the short version would be that craft beer started to happen, in Minnesota and kind of at some scale, maybe 22, 23 years ago. For the first time since probably before Prohibition, Rahr had new customers coming to them and wanting to purchase malt. But then those new customers also wanted new products and new kinds of malts, especially different varieties of imported malts from the UK, Germany, Belgium, Ireland, and so on. So, when Rahr started to get new customers, they also began really diversifying their supply chain, when they were going to have to start importing. Also looking at where they forecasted the craft brewing scene could go, and the growth they predicted, Rahr formed a separate company to serve craft brewers specifically, and that’s how BSG started.
Fast forward to where we’re at now, and craft beer has had explosive growth for two decades; it’s still growing, but not at the rate it was in the early 2000s or 2010s. We have 10 warehouses in the US, and we have four in Canada. We sell ingredients to primarily craft breweries: everyone from large national brands to single-location taprooms or brewpubs, and all sizes in between. There are 9000-some breweries in the US today, and the majority of them are those smaller-scale, local outfits. That’s reflected in our own customer demographics – we have a high percentage of those smaller, truly local customers.
BD: What kind of ingredients are we talking here, specifically? What countries are you sourcing from?
JS: If you’re a craft beer person, you know that it requires a lot of malt and hops, and that’s definitely what we sell a lot of. We’re actually one of the largest grain importers out of Western Europe, because a lot of our customers want premium Weyermann malt from Germany, or Crisp and Simpsons from the UK, or Dingemans coming out of Belgium. So, we do a lot of importing of malt. Rahr is our domestic malt partner, obviously, as our parent company, so we bag, palletize, and ship out a lot of their malt to our customers. A lot of hops as well, we have a hops production plant in Wapato, Washington where we produce hops pellets, and then move them out to other BSG warehouses. Really, that’s the bulk of what we sell, but on top of that is about 3000 other SKUs of raw materials: yeast, nutrient, sugars, flavorings, enzymes and process aids. Then we have a Handcraft line, which is essentially homebrew retail, so you’ve got smaller quantities of other ingredients, but you’ve also got hoses and buckets and filters, and anything you need for the homebrew side of things.
BD: Tell us about the origins of the malt bag recycling program. Was there particular idea or spark that made the company realize that this was something that they wanted to pursue?
JS: From a corporate standpoint, we have been talking about investigating sustainable options for quite a while. I think, for us, along with a lot of other corporations our scale, there’s a couple of factors at work. To make a change at any level, it just takes a little bit more time. We’re talking about different systems, a larger network…It’s a little bit more effort to get that momentum behind it.
I’m in the logistics transportation department, which is an energy-intensive part of any business or industry, not just craft brewing. We’re moving a lot of things around on ships, trucks, and rail cars. That’s one of the reasons we have fourteen distribution centers across North America (fifteen with our new facility for cans in Salt Lake City): it lowers the average miles it takes to serve customers in that area.
Bag recycling has been a request from our customers for quite a while. Even a small brewery is going to order one or two pallets of malt [per shipment], which is between 80 to 120 bags. The malt goes into the mash, and then they’ve got empty bags just sitting there to go to the dumpster. It just feels like a pretty big waste. But the emissions part of that equation, as far as capturing those bags, was kind of a wrench in coming up with a simple solution. We could have them ship [the bags] back, but anything we gained by either reintroducing bags to our supply chain or taking them to a recycler is locked by the additional emissions that we create by having to go out to get those bags. So we didn’t have a great solution a couple years ago when we initially looked into this.
Since then, five of our warehouses have developed a local courier program where it’s a BSG driver picking up at the BSG warehouse. Then, he’s driving about an 80-mile radius from our warehouse to all those local Minneapolis/St. Paul customers. There’s a bunch of service benefits there, but it was also the missing piece for bag recycling.
With a traditional freight delivery, let’s say a Twin Cities brewery calls up our customer service team and places an order for two pallets. Let’s say we ship it later that day – it’s picked up by a freight carrier and goes to a terminal, usually somewhere in outer ring suburb. It’s offloaded that night, and then in the morning it’s loaded on a different truck that then takes it out for delivery to the customer. With our courier program, we can go direct to our customer with one of our own trucks, about 45-55% of emissions are reduced there by circumventing a traditional freight terminal.
Then we said: what if we we can line up a pickup of empty malt bags with a customer’s order when we’re already going there? That way we’re not making extra trips and adding carbon to the atmosphere for these bag pickups. Customers hold on to the empty bags, they place an order, and let us know “Hey, when you come make a delivery, I’m also going to have this many bags for you to pick up.” Our driver grabs it at the same time, consolidates them, and then drops them off at our warehouse. We hold them until we have a full truckload’s worth, and then ship them over to a recycler. So, getting that courier program in place really was kind of the key for the emissions piece making sense as far as being able to recycle these bags.
Also, we are not limiting this program to only BSG products. If our customers have empty malt bags from any other suppliers, we are more than happy to pick those up as well and recycle them.
Beer Dabbler: What about the recycling process itself? It seems like these bags aren’t quite as straightforward to recycle as, say, aluminum cans.
JS: Like always with a lot of things in the world, you don’t know how much is involved until you start poking around. No one, at least in the Minneapolis market, was recycling anything like a malt bag. Malt bags are a woven plastic exterior, with a plastic liner inside. So the liner has to be removed and recycled as a different type of material, so we had to locate a recycler for that too.
So we had to find the right recycler that was willing to accept these kinds of products, and that was also willing to give us reports about what kind of material [the recyclables] are being turned into. Generally, these bags are being cleaned, recycled, shredded, and then turned into insulation for homes. Some are just general fill, where it becomes a plastic widget or whatever, but mostly into insulation, which is pretty cool.
What’s nice about BSG, as a larger company it means small changes are amplified. When we’re able to capture bags like we are now, even just in the Minneapolis-St. Paul market, that is thousands of bags a week that are now being recycled that weren’t before. So that scale is nice to see.
BD: What are your ultimate goals for the program? Do you plan on expanding recyclable bags to other markets?
JS: Our local courier program currently operates out of four other warehouses: Vancouver, WA; Oceanside, CA (San Diego area); San Leandro, CA (Bay Area), and Atlanta, GA. Those will be the first places we look to grow. We’re currently looking for the right recycler in all those markets. We don’t want to get a container’s worth of bags and ship them to Minnesota [for recycling], that defeats the purpose. So, finding a local recycler that has capacity to take them…as soon as we find that, then we’re kind of pretty much ready to go as far as rolling it out to any of those other four cities.
We are working with some larger customers in the [Minneapolis-St. Paul area], to be a delivery hub where we can put a container outside in a parking lot, or behind the brewery. Then, customers that are outside of this courier program area, in greater Minnesota or Western Wisconsin, if they wanted to, could hold onto their bags, bring them to dump them off, and then we can do the same kind of pickup model the next time that larger brewery places an order.
BD: What has the response been like from your customers so far? Are breweries excited to be part of this program?
JS: Super, super positive. This isn’t something we have to sell to our customers, which is great. You know, it’s something that we’re happy to provide and we’re also happy that they’re more than willing to participate. Because sustainability is a shared desire for their business models and ours.