Economic Development, Food Service & Agriculture, and Manufacturing

Malt producer expands to Mid-Atlantic

December 11, 2015
| By Pat Evans |
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Pilot Malt House Ryan and Erik
Ryan Hamilton, left, and Erik May of Pilot Malt House believe following ingredients farm-to-glass is the next logical step in the local movement. Photo by Michael Buck

A local malt supplier to makers of craft beer and spirits is opening a second operation in the Mid-Atlantic after being welcomed with open arms by officials there.

Erik May, the founder of Byron Center-based Pilot Malt House, which malts grains, and Virginia Governor Terry McAuliffe announced yesterday that a second Pilot Malt House facility will be developed in Loudoun County, Va.

"We'd be kicking ourselves"

May said Pilot’s business plan all along has been to have a process that can be duplicated and to open a second location in an area that needs a malting operation. However, he didn’t see it happening this soon.

May told the Business Journal that Virginia is aggressive in its economic development endeavors and offered cash incentives, investor help and 12 years of tax abatements to help get the new facility started, which will likely be operational next year. The investment in the project is about $1 million.

“The chips fell perfectly,” May said. “They made it happen. It wasn’t us. If we would have said no, we’d be kicking ourselves for years to come.”

The Virginia operation started because of a chance encounter between May and Virginia Secretary of Agriculture and Forestry Todd Haymore at April’s Craft Brewers Conference in Portland, Ore.

The meeting led to beers and potential plans being laid out on a napkin.

Growth curve

May said although the company’s goal was to have more than one location, he doesn’t expect it will go beyond two locations.

“I think we’re good now,” May said. “We were nuts enough to start one business, crazier to start a second. I don’t envision any more Pilot Malt House locations, but if another deal like this pops up, we’d be stupid not to look into it.”

The company was started in 2011, and 10 acres of barley were grown for the supplier in 2012. This year, more than 1,500 acres of barley, wheat and rye were grown for the company. Next year, Pilot projects to malt 350 tons of grain for Michigan breweries and distilleries, May said.

"Win for the Commonwealth"

The Pilot Malt House facility will be located on an 80-acre farm, along with the state’s lone hop processor and a brewery, which is likely to open next weekend.

California’s Stone Brewing Co., one of the country’s largest breweries, is opening its East Coast brewery in Richmond, Va., which May said helps show Virginia’s commitment to craft beer, likening it to Michigan’s beer industry in 2008. Craft beer provides a $625-million economic impact for Virginia.

“This unique facility in Loudoun County represents another step forward for Virginia, as we cement our reputation as key players in the nation’s fast-growing craft beer industry,” Secretary Haymore said. “Craft beer is contributing positively to the economies of big cities and rural communities across the Commonwealth, adding to the governor’s call to build a new Virginia economy.”

Pilot Malt House will likely purchase 2-million pounds of Virginia barley, wheat and rye in the next two years to be malted and sold to Virginia beverage makers.

The facility fills in an empty spot in the Virginia craft beer supply chain and helps keep farmers in the state involved, said Buddy Rizer, economic development director, Loudoun County.

“We will now have the ability to malt locally grown grain right here in our county,” Rizer said. “Pilot Malt House will allow more investment to stay in Loudoun and will ensure that Virginia’s craft beer industry is heavily rooted in Loudoun’s rural economy.”

In under two years in office, Governor McAuliffe has seen 533 economic development deals and $9.17 billion in capital investment.

The investments stretch across many industries, but McAuliffe is committed to making Virginia a beer haven.

“This is a significant win for the Commonwealth, as it fills a need for current and future craft brewers and builds on my administration’s efforts to make Virginia the East Coast leader in the fast-growing craft beer industry,” McAuliffe said.

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