Politicians and economists have long recommended that Maine grow its economy by increasing the value of its natural resources. This was most cleverly articulated by Sen. Angus King who declared that “no fish shall leave Maine with its head on” during his 1994 gubernatorial campaign.
Yet since then, Maine has steadily fallen behind on what economists call “value-added economic activity,” which measures the worth of what each worker produces. The state ranked next to last in the country in 2015 on this measure, according to the Maine Development Foundation.
The burgeoning craft beer industry is now opening up opportunities for farmers and entrepreneurs to add value to grains, turning plain grains into malt (the main ingredient in beer after water) and beer. Maine craft beer is now a $157-million-dollar industry, and it’s projected to grow by 41 percent from now until 2020, according to a University of Maine study.
The potential for grains is vast. Maine farmers already grow an estimated 3,000 to 7,000 acres of malt-quality barley because it grows well in rotation with potatoes. Most farmers sell their barley to large commercial buyers for low prices because they’re not set up to sell to the local market. They could earn more than double per pound by selling it to the local craft beer market, according to brewers and people who malt beer in the state.
There are other bottlenecks in the way of Maine reaching its grain potential: farmers and people who turn barley into malt, called “maltsters,” don’t have the equipment needed to process barley; not enough farmers know how to grow the right quality of the grain; and brewers often can’t afford the high prices of local ingredients.
Many entities — including consumers, farmers, state government — have a role to play in helping the local grain industry overcome these obstacles, thereby growing the economy of northern Maine.
The state government’s role is especially important because developing new agricultural products is particularly expensive and risky, and therefore such efforts are unlikely to succeed without government support, said Brian Depew, executive director of the nonprofit research group Center for Rural Affairs.
“It’s really about helping people develop new markets, standing up things that can be profitable businesses on their own in the long term but that need a leg up at the beginning,” Depew said, referencing state investments in agriculture research and infrastructure.
There are three steps the Maine government could take to help the local grain industry overcome some of the challenges it faces and grow:
First, lawmakers could take a cue from New York and provide incentives to brewers who use local ingredients. In 2013 New York enacted a law that exempts breweries from sales tax, waives a registration fee, and allows them to serve beer on site in exchange for ensuring a percentage of their ingredients is from in-state. Since then, the number of acres of malt barley being grown for the local market has tripled, according to a Cornell University study.
Second, the state could invest more in research and in the University of Maine Cooperative Extension, which, among other things, connects farmers to best practices and the latest research. Research — and people who will share it with busy farmers — is necessary for any new agricultural product to take root.
There’s certainly room for improvement on this front. Maine spends less per capita on research and development than most other states, ranking 36th in the country, according to the Maine Development Fund. And over the past 30 years, the number of faculty working for the university’s extension has been cut about in half in response to budget cuts, said John Rebar, the extension’s executive director.
Third, Maine could increase funding for the division within the Department of Agriculture, Conservation and Forestry that supports farmers: the resource development division. Over the past decade, the state has cut funding for this division by about one third.
All these steps could help accelerate the growth of a burgeoning industry, bring more wealth to farmers and boost the export potential of beer for brewers. Maine can essentially create a new twist on King’s fish mantra: “Let no barley leave the state unmalted.”