How Long Can Craft Beer’s Run Last?
Time magazine’s Brad Tuttle wonders how much longer craft brewing’s run can last. His list of concerns starts with the new definition of “craft brewery”: six million barrels a year hardly fits the image of the indie underdog challenging Big Beer–which, for its part, has rolled out “crafty” beers like Third Shift and Blue Moon.
Then there’s sticker shock. A growing number of craft breweries are putting their high-end beers in 22-ounce bomber bottles. They justify the high price of the product by comparing it to wine, but Tuttle points out that a customer with a bit of math savvy can figure out that the per-ounce cost of bomber beer is twice that of beer sold in six-packs.
$115 For Sam Adams Utopias?
Canadian beer writer Stephen Beaumont was taken aback when a Toronto Globe and Mail wine critic called the price of Samuel Adams Utopias ($115) “exorbitant,” “stratospheric,” and comparable to “Rolex watches and Prada purses.”
Beaumont pointed out that the same critic described a bottle of Balvenie 17 Year Old Double Wood ($168) as merely “expensive,” and made no comment about the price ($189) of 15 year old Nikka Miyagikyo. He also did some number-crunching. A bottle of Utopias contains 12 servings–two ounces, given that it has twice the alcoholic content as the average wine. Thus a serving of Utopias costs about $10, “about what one might pay for a glass of ho-hum wine in a restaurant.” Beaumont contends that critics still have a double standard when they compare beer to other beverages.
15% Craft Market Share and Other Fun Facts
The Demeter Group, a California-based investment bank, has compiled a report (16 pages, pdf) on America’s brewing industry. Demeter projects that craft beer, a market segment with 10-percent compounded annual growth rate, will have a market share close to 15 percent by 2020. And to think, people scoffed at Kim Jordan’s prediction that craft would some day account for 10 percent of the market.
Other interesting facts in the Demeter report:
Jay Brooks on the Brewing Industry
West Coast writer Jay Brooks took exception to a recent column in the New York Times about the proposed buyout of Grupo Modelo by Anheuser Busch-InBev. He concluded that the correspondent, Adam Davidson, knows little about the brewing industry and its history.
In a blog post on the Brookston Beer Bulletin, Brooks first addresses Davidson’s “sure, the industry is competitive, look at all the brands on the shelves” argument. His response: “saying they’re on equal footing is the economic equivalent of pretending that employees and employers have equal bargaining power, as most economic textbooks continue to insist.”
He then responds to Davidson’s characterization of A-B InBev being “on the cusp” of a monopoly by saying that ABI has been a de facto monopoly with one or two others for decades, all but controlling the marketplace. As for Davidson’s statement that we are in “the very early stages” of industry consolidation, Brooks points out that “the global beer world has been dominated by an ever-shrinking group of very large conglomerates for at least the last three or four decades.”
Finally, Brooks offers his prediction of what will happen next:
As always happens, the two parties will hammer out a compromise that was probably the deal everybody wanted in the first place, but this way both parties look good in the public eye. The [Justice Department] will look like they’re being tough on big business and are protecting the public while ABI will look good because they were able to get the deal done, and their share price will shoot up.
The Friday Mash (Penny Wise Edition)
February 15, 1971, was Decimal Day in Britain. From that day forward, the pound sterling was worth 100 pence; and shillings, half-crowns, florins and other charming coinage passed into British history.
And now…The Mash!
We begin in Australia, where that country’s governing body for cricket is combating the dreaded beer snake created by fans stacking thousands of cups through the grandstand.
John Schreiber of Manhattan Beach, California, has come up with beer pairings for Girl Scout cookies. For example, Thin Mints call for an old ale, like North Coast Brewing Old Stock Ale.
Jay Brooks has posted a new Periodic Table of Beer Styles at his Brookston Beer Bulletin. Credit for the table goes to a Reddit user named “Delirium Tremens.”
Something old, something new. The Epiphany One Puck will recharge your phone with a cold beer. The devices uses a Stirling engine, which turns heat disparities into energy.
NerdWallet.com scoured the country for the city with the cheapest beer. It’s Carlsbad, New Mexico, where a six-pack of Heineken costs $7.25. Most expensive? New York City, where the same sixer carries a $12.63 price tag.
Why has Sam Adams Alpine Spring been on the shelves for weeks? Jim Koch, Boston Beer Company’s CEO, explains that “in New England, we tend to look forward to next season.”
Finally, Bavarian glassmaker Spiegelau, with help from Sierra Nevada and Dogfish Head, have developed a glass designed for drinking IPA. Its ridges at the bottom bring out flavor by creating more foam.
The Friday Mash (Aloha Edition)
On this day in 1778, Captain James Cook discovered the Hawaiian Islands. Hawaii is one of only four states that were independent countries before joining the Union. The others are California, Texas, and Vermont, which was a republic between 1777 and 1791.
And now…The Mash!
We begin in Denver where, for the third straight year, Governor John Hickenlooper mentioned beer in his State of the State address. Before entering politics, Hickenlooper owned the Wynkoop Brewing Company.
If you’re in the mood to waste some time, check out SuperBowl-Commercials.org (yes, that’s a real site) and start with a few memorable beer commercials, including one featuring Budweiser’s talking frogs.
The Standard Reference Measurement assigns a number between 1 (lightest) and 40 (darkest) to describe the color of beer. Jay Brooks has posted an SRM chart and other color-related links on his Brookston Beer Bulletin.
The “Big D”–Drewrys beer–might be returning to Indiana. Chicago entrepreneur Frank Manzo has acquired the Drewrys name and is lining up capital for his brewing venture.
Sprecher Brewing Company, which is famous for its root beer, is test-marketing an alcoholic version called Hard Root Beer. It has bourbon and oak flavors, and weighs in at 5% ABV.
Some experts worry that cheap beer is a health problem, and that U.S. beer prices are about to drop because of consolidation and vertical integration in the brewing industry.
Finally, congratulations are in order to Fred Bueltmann, a managing partner at New Holland Brewing Company in Michigan. His book, Beervangelist’s Guide to the Galaxy, will be published this spring.
The Friday Mash (G.I. Bill Edition)
On this day in 1944, President Franklin D. Roosevelt signs into law the Servicemen’s Readjustment Act, commonly known as the G.I. Bill. Some 2.2 million veterans took advantage of the law’s best-known benefit: financial aid for those who wanted to go to college. It covered tuition and living expenses…but alas, not beer.
And now….The Mash!
We begin in Pennsylvania, where lawmakers are debating an overhaul of its quirky liquor laws. The proposed changes include scrapping the infamous “case law”, which requires customers to buy at least 24 beers per transaction.
Last year, Anheuser-Busch InBev trademarked a number of area codes, presumably for regional versions of 312 Urban Wheat Ale. Now it has applied for marks for more than 40 three-letter symbols for American airports. Critics ask: are ZIP codes next?
In Quingdao, China, drinking and driving definitely don’t mix. IndyCar officials have canceled a race to be held there in August because it would conflict with the International Beer Festival.
Roy Desrochers holds down an enviable job: he’s worked as a professional beer taster for more than 30 years. Desrochers says it takes more time to gain beer-tasting certification than it does to earn a doctorate.
Tyler Hansbrough of the Indiana Pacers is known around the NBA as a “character.” He added to that reputation by chugging a 40-ouncer at a bar. The 40 was inside a brown paper bag.
A consumer research firm in Washington State ran the numbers and figured out who drinks microbrews. Males, those with college diplomas, sports fans, and Westerners are most likely.
Finally, a tree grows in Brooklyn, but hops are growing in the Bronx. The Bronx Brewery has teamed up with the New York Botanical Garden and community gardens to grow them in the borough.
The Friday Mash (”Woooooooo. Pig. Sooie!” Edition)
On this day in 1836, Arkansas was admitted to the Union as the 25th state. Famous Arkansans (the accent is on the second syllable) include country singer Johnny Cash, Wal-Mart founder Sam Walton, former president Bill Clinton, and Tusk, the live hog that serves as the mascot for the Arkansas Razorbacks football team.
And now….The Mash!
We begin in Portland, Maine, home of an economist’s dream. Brewers and distillers have clustered in a district called Brewer’s Row. Notable residents include D.L. Geary Brewing Company and Allagash Brewing Company.
Erik Lars Myers, who blogs at Top Fermented, is also the frontman for Mystery Brewing Company. Myers explains how he raised $44,000 on Kickstarter.com to help launch his brewery, and explains how it was done.
The Los Angeles Kings won their first NHL title in their 45-year existence. Part of the Kings’ celebration consisted of drinking a bottle of Budweiser, left over from their loss to Montreal in the 1993 final, out of the Stanley Cup.
Kid Rock is scouring Michigan to find a new contract brewer for his American Badass Beer. Michigan Brewing Company, which made the beer, was foreclosed on by its bank and reportedly faces possible eviction.
Have you ever tried beer ice cream? Victoria Johnson of TheAwl.com has a recipe that uses beer and just three other ingredients: sugar, egg yolks, and heavy cream.
They’re not exactly moonshiners, but homebrewers in Mississippi are still breaking the law. Raise Your Pints, which successfully lobbied for a higher ABV cap in that state, is working to get the homebrew ban repealed.
Finally, 88-year-old Ethel Goldschmidt, of Brooklyn, New York, has started her own beer company. Her flagship beer is Ethel’s Brew, a summertime beer inspired by her 1951 trip to Oktoberfest with her late husband, Burt.
Why Craft Beer Can Save America
American consumers are driven by the lowest price–a marketing approach pushed relentlessly by companies such as Wal-Mart. But author David Sirota sees a different approach. He points out that beer consumers are choosing quality over cheap, mass-produced American beer:
Produced through the macrobrews’ low-price, high-volume process, they don’t contain high-quality ingredients, they don’t contain much alcohol and, thus, they simply don’t taste good. Knowing this, the macrobrews have logically designed their marketing campaigns to focus on everything (the can, the type of people who drink it, the logo, etc.) but the actual product. Indeed, if there’s one ubiquitous reference that macrobrewing companies make to the beer itself, it’s usually one telling you how cold the beer is or should be–a temperature that, quite deliberately, helps hide just how bad the beer actually is.
By contrast, craft brewers, which are mostly independent small and medium-size businesses, know they can’t compete on a volume. They therefore promote quality and diversity.
Sirota believes that the David-versus-Goliath competition goes beyond the brewing industry, In the years to come, in a variety of products, consumers will choose between China’s “Wal-Mart” model–low prices, cheap labor–and Germany’s “craft brew” model–high quality and high performance.
Bend, Oregon: The Beer Economy
A quarter century ago, no one could have predicted that Bend, Oregon (population 80,000), would become a leading American beer city. It was a struggling lumber town with no university and no interstate highway; and it was cut off from the state’s major cities, more than 150 miles away, by a steep mountain range.
The city’s beer boom started in 1988 when Gary Fish opened a brewpub, which grew into the Deschutes Brewing Company. Other craft brewers set up shop in Bend, and beer has grown into a major industry. Four hundred and fifty residents work in breweries and brewpubs. That’s 15 percent of Oregon’s total brewing employment, even though Deschutes County accounts for only four percent of the state’s workforce. Beer aids the local economy in another way: people are finding their way to Bend specifically to drink the local beer.
The city’s beer boom couldn’t have come at a more opportune time. The recent recession hit Bend especially hard due to the collapse in housing prices.