The Puget Sound Business Journal’s current cover story is on how Washington’s drought is affecting craft breweries. (The story is behind the paywall.) The impact is most felt via the hops that are used in production. Demand is high for hops, and “demand plus drought is a costly combination.”

Michael Butler, chairman and CEO of Seattle-based investment bank Cascadia Capital, predicts pricier times ahead.

“The demand for hops will outstrip the supply of hops. In 2017 and 2018, the imbalance will be at its worst,” Butler said. “Hops prices are high now, but I see them going through the stratosphere.”

But the cost of ingredients is only one factor in pricing — labor costs also matter. Dave Leonard of The Ram brewpub group said, “I think everyone’s contracted now, so prices are set. In Seattle, the minimum wage and health care plans are more where you’re going to see an increase in prices.”

Washington leads the nation in hops production, and in 2013 (the latest data available), the value of hops grown in Washington was $202 million (the 10th highest-value crop in the state).