Tag: Brewers Association

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State of the Craft Beer Union

Yesterday, Bart Watson presented the Top 50 Breweries in the US for 2022 along with answering questions about other items of craft beer economic import. Y’all probably saw the shares and re-tweets of the list but below are my take-aways from the press conference.

  • overall production was static at around 24+ Million barrels
  • total retail dollars grew due to higher beer prices and a shift back to on premise drinking
  • 9,552 active breweries in 2022 (though some may not have finished the year as active)
  • openings still outpace closings 549 to 319
  • no correlation between higher beer prices and slower growth
  • taproom only models are skewing younger in years and perform better in general
  • leases tend to be the main drivers in closings

I will dip into the Top 50 from a California perspective but this year saw the exit of Bell’s from the list since they do not meet the ownership criteria for craft and Stone will exit next year due to their sale to Sapporo. Also Yuengling is numero uno this year.

Here are the CA breweries in the Top 10

#3 Sierra Nevada

#4 Duvel US (which includes Firestone Walker)

# 7 Stone

Others include both Coasts, Lost and North, Pizza Port, Gordon Biersch and Craft Ohana which is the Maui Brewing / Modern Times group.

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Bart on 2022 (and 2023)

Before Christmas, Bart Watson, the economics guru for the Brewers Association talked about craft beer in 2022 as well as a dip into what he thinks maybe in store for 2023.

Here are some of the numbers nuggets from his talk….

  • breweries with direct sales are close to 2019 pre-pandemic sales
  • check-ins from Untappd data shows an uptick in ticks from a brewery
  • channel shift due to the pandemic is reverting back
  • around 9,500 breweries in the U.S. now
  • more openings than closings by a 2 to 1 ratio
  • Imperial IPA, Hazy IPA, low to no alcohol beers doing well
  • 2023 openings will probably be lowest in years
  • 2023 distributed craft only breweries won’t grow
  • 2023 some inflation price hikes might hit early in the year

It looks like some tough sledding next year but as the world clicks closer to normal, more opportunities might show themselves.

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Sales Data

First, I suggest you take a quick read of Bart Watson’s take on the first half sales numbers for 2022. You can click right HERE for that.

Now what leapt out at me wasn’t so much the numbers for on premise or OpenTable reservation data but a term that was new to me, channel shift.

Now it is just a fancy way of saying that people bought beer from different places but it is quite interesting to see how the swirling will they-won’t they of Covid restrictions and lessening thereof has thrown things out of whack.

Pivoting is good and was practically required of breweries but it does making reading the tea leaves much harder. Toss in supply chain snafus and airline flight cancellations and each year becomes an unenviable sorting task for Watson.

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Tweaks

The Brewers Association made no big waves in their 2022 beer style guidelines. Clarity, spelling and grammar being the key words in their press release.

“As the craft beer landscape continues to evolve, we want to ensure that our Beer Style Guidelines continue to be a trusted resource worldwide and are in stride with the innovation that continues to be brought forward,” said Chris Swersey, competition director, Brewers Association. “We took 2022 as a year to focus on housekeeping, to address some discrepancies within the exiting beer styles, and for a small number of significant updates to certain beer styles.”

Stay tuned for GABF in the fall to see who comes up with medals.

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Newly in Style

The 2021 style guidelines dropped at the end of February and here is the news people are tuning in for, what new styles have been added?

Per the Brewers Association press release…

“Hundreds of revisions, edits, format changes, and additions were made to this year’s guidelines, including updates to existing beer styles and the creation of new categories. New additions to the beer styles include:”

  • Kentucky Common Beer
  • New Zealand-Style Pale Ale and India Pale Ale
  • Belgian-Style Session Ale

I bet local Ten Mile Brewing will be sending their Common, Hidden Hollow on to GABF but this also helps the IPA focused breweries who now have less crowded main categories as the entrants shift to hazy. My interest lies in which of Kentucky Common and Belgian Session have more entries.

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Historical Brewing

The Kviek yeast wheel in the top middle photo should get the science beer geeks excited but what is super cool if author Lars Marius Garshol can make it work, is conjuring up old practices and lore and explaining it to a modern generation.

Here is the elevator pitch for this new book, “Equal parts history, cultural anthropology, social science, and travelogue, Historical Brewing Techniques describes brewing and fermentation techniques that are vastly different from modern craft brewing and preserves them for posterity and exploration.”

This sounds like a fun way to get “outside” the house by book instead of plane.

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Last Year’s Sales

The Brewers Association released the sales numbers for last year, and normally I would post about it from the standpoint of California brewers or breweries entering or leaving the top 10 but this year, the numbers will need to be viewed against the 2020 numbers as well as the 2021 numbers before you can truly glean some insights.

I expect to see some churn in companies and quite possibly more CANarchy like groupings when we hit the post virus phase. I wrongly expected to see closures aplenty by now but the loans and financial measures seemed to have postponed those, though I still think fallout is coming. Unemployment numbers are going to really start to hurt, really soon. Unless Biden gets elected come November, I do not think there will be much long-term help for small business and especially a small business in California.

I sorely wish that I could do a pro forma, boring post about who is in the lead though.

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Federal Relief?

So, despite some light Republican siding with corporate interest resistance, the first of what may be many CoronaVirus bills has been signed into reality.

Phase 1 is about free testing, sick leave and expanding unemployment benefits.

Phase 2 would have small business loan assistance

Also, the Brewers Association is going to push their weight behind the following initiatives…

  • “A temporary suspension or deferral of federal excise taxes;
  • A waiver of penalties for payment of late excise tax fees;
  • A business tax credit for lost sales;
  • Flexibility in submitting amendments to licenses for current permit holders;
  • An increase in funding for Small Business Administration (SBA) Disaster Relief Assistance programs;
  • Deferment of SBA loan payments/no interest loans;
  • Deferment of payments with no interest accrual for loans with commercial lenders;
  • A freeze on premium increases for unemployment insurance;
  • Suspension of payroll taxes;
  • Compensation Fund.”

That list is taken from information from the BA and of those items, the last one is the most important. Breweries need a replacement cash flow and hopefully they can get it.

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Science Grants

The Brewers Association has selected the 2020 recipients of its Research and Service Grants Program. This funding, which began back in 2015, funds research into science that will effect brewers and how they make beer. This year the Brewers Association parceled out 13 grants totaling $389,370 to thirteen projects (8) barley and (4) hops projects, and in a change one draught quality project which I found a pleasant surprise. Overall, in six years, this program has invested over $2 million for research.

Below are the (4) that I think will have the most future impact on consumers in the years to come:

Controlling Hop Enzymatic Potential – Hop Kilning and Brewery Treatments

  • Partner(s): Oregon State University
  • Principal(s): Thomas Shellhammer

Analysis of Various Metabolites in Hops as Potential Key Parameter for Thiol and Ester Release by Yeast During Beer Fermentation

  • Partner(s): Nyseos, Barth-Haas Group
  • Principal(s): Laurent Dagan, Christina Schoenberger

Deeper Explorations of Barley and Terroir Contributions to Beer Flavor

  • Partner(s): Oregon State University
  • Principal(s): Pat Hayes

Evaluation of Biofilm Growth in Chemically Treated Beer Draught Tubing

  • Partner(s): Montana State University, Center for Biofilm Engineering
  • Principal(s): Darla Goeres
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FOOD: Transforming the American Table

For those heading to DC, the Smithsonian is going to show a little more of a beer side, ” “FOOD: Transforming the American Table” is an existing, permanent exhibition that explores the history of food and eating in the United States since 1950. The exhibition’s fall update will highlight new stories about changes in food itself and how Americans produce, prepare and consume food and drink. One of four major new sections is “Brewing a Revolution.”“

Per the Brewers Association press release, “Visitors will see artifacts, archival materials and photographs that originated in the homebrewing and microbrewing movements of California and Colorado in the 1960s through 1980s—the beginning of the craft beer “revolution.” “

Check out more about this exhibit HERE.