Boston Beer Company

The Friday Mash (“Don’t Cry for Me” Edition)

On this day in 1946, Colonel Juan Peron, founder of the political movement known as Peronism, was elected to his first term as President of Argentina. He and his wife, Eva Duarte, would later become the subject of the Broadway musical Evita.

And now….The Mash!

We begin in Maryland, where craft brewers are concerned about Guinness’ plans to open a taproom at its new brewery. At the same time, retailers worry that raising the cap on how much breweries can sell on-premises will hurt their business.

This year’s beer trends include the “haze craze”: unfiltered and unpasteurized IPAs aka “New England IPAs”. These beers have a shorter shelf life, but are richer in both flavor and aroma.

Atlanta’s SweetWater Brewing Company is paying off a Super Bowl bet by releasing 100 cans of SB51 beer. It’s described as “a soul crushing pale ale that will leave you deflated”.

Tomorrow, Cleveland’s Slovenian community celebrates Kurentovanje, its version of Mardi Gras. Festival-goers will dress up as giant fuzzy animals to scare winter away, and drink beer at the newly-opened Goldhorn Brewery.

Three machinists and designers are about to launch the Kramstein beer stein. This metal stein, which comes in two sizes, is designed to keep the drink cool and the drinker’s hands dry.

Martin Roper, who’s been CEO of the Boston Beer Company for 16 years, plans to step down next year. TheMotleyFool.com speculates on whether Roper’s successor can arrest the company’s recent sales slump.

Finally, the BrewDog brewery offers an unusual perk: a week’s “paw-ternity” leave to employees who adopt a new dog. It also allows employees to bring their dogs to work. The company’s founders worked under the watchful eye of their “brew dog”, Bracken.

Beer…By the Numbers

  • Asia’s per capita beer consumption in 2016: 57 liters.
  • India’s per capita beer consumption in 2016: 4.7 liters.
  • India’s microbrewery count in 2016: 80.
  • Its microbrewery count in 2008: 2.
  • Boston Beer Company’s net revenue in 2016: $687 million (down 8 percent from 2015).
  • Boston Beer Company’s share price on January 27, 2017: $153.85.
  • Its share price two years ago: $320.83.
  • Lagunitas Brewing Company’s current annual production at its Chicago brewery: 405,000 barrels.
  • Its projected annual production after planned expansion: 1.2 million barrels.
  • Goose Island Beer Company’s annual production (estimated): 480,000 barrels.
  • Chicago breweries’ combined annual production (estimated): 1.115 million barrels.
  • MillerCoors’s sales in Wisconsin, 2012-16: 38.2 million barrels (biggest seller in Wisconsin).
  • Mark Anthony Brewing Company’s (Mike’s Hard Lemonade) sales in Wisconsin, 2012-16: 3.3 million barrels (second-biggest seller in Wisconsin).
  • Alcoholic strength of Founders Centennial IPA: 7.2 percent ABV.
  • Alcoholic strength of Founders All Day IPA: 4.7 percent ABV.
  • Forecast for 2017: Craft Beer Turf Wars

    The number of craft breweries continues to grow rapidly, while the growth of the craft sector is slowing. Which means something has to give.

    Jason Notte of Marketwatch.com predicts that 2017 will be the year of the turf war; there will be less mergers-and-acquisitions activity and more competition among breweries to claim shelf space.

    This could be the year that craft breweries lay off workers and make other cuts in an effort to trim costs. Industry leader Boston Beer Company has been hit hard by shrinking sales of Samuel Adams Boston Lager; the company’s shares have tumbled 50 percent from their 2015 high.

    We’re also likely to see more breweries bring in private-equity firms. Already this year, Victory Brewing Company and Southern Tier Brewing Company have formed such partnerships with such firms.

    And we’re likely to see smaller brewers focus on taproom traffic and food sales and avoid the battle to get their products on store shelves and on bar and restaurant menus.

    Notte believes that Oskar Blues is the brewery to watch because it has been the craft sector’s trend-setter for years. The brewery was the first to can its beers and the first to build a second facility in the eastern United States. Two years ago, it kicked off the private-equity trend when it sold a majority interest to Fireman Capital. It then used some of that money to acquire craft breweries in Michigan, Florida, and Texas; the latter two states are considered underserved beer markets. Oskar Blues also borrowed from the big national brewers’ playbook. It rolled out more mainstream beers, sponsored sporting events, and put an emphasis on brand recognition.

    Notte concludes, “Whether drinkers benefit from [this] turf war or become victims of it remains to be seen.”

    Beer…By the Numbers

  • Top ten brewers’ share of the craft beer market in 2015: 3.8 percent.
  • Their share of the craft beer market in 2009: 5 percent.
  • People employed by Ohio craft breweries: 2,500.
  • Ohio’s current craft brewery count: 190.
  • New York State’s brewery count in 2015: 240.
  • Its brewery count in 2012: 95.
  • Craft brewing’s impact on New York State’s economy: $3.5 billion (fourth-highest in the U.S.).
  • Boston Beer Company’s (ticker symbol: SAM) closing price on May 13: $150.04 a share.
  • SAM’s highest price during the past 52 weeks: $266.62.
  • Calories in a 12-ounce can of Budweiser: 145.
  • Calories in a 12-ounce can of Bud Light: 110.
  • Bud Light’s share of the world beer market: 2.5 percent (third overall).
  • Snow beer’s share of the world beer market: 5.4 percent (first overall).
  • Cost of a liter of Snow beer in China, its home country: $1.
  • Growth in Snow’s sales volume since 2005: 573 percent.
  • Beer…By the Numbers

  • Price of a “regular bottle” of beer at Super Bowl 50: $13.
  • Price of a “premium draught” at Super Bowl 50: $15.
  • Cost of Anheuser-Busch’s anti-drunk driving Super Bowl spot featuring Helen Mirren: $10 million.
  • Estimated value of Peyton Manning’s post-Super Bowl endorsements of Budweiser: $3.2 million.
  • Germany’s annual hop production: 34,000 metric tons (first in the world).
  • United States’ annual hop production: 33,266 metric tons (second in the world).
  • Washington State’s share of U.S. hop production: 70 percent.
  • Beer’s share of the world-wide alcoholic beverage market: 80 percent.
  • Beer’s share of India’s alcoholic beverage market: 30 percent.
  • Beer’s share of the U.S. alcoholic beverage market in 2015: 48 percent.
  • Its share of the U.S. market in 2000: 55 percent.
  • Maximum weekly “units” of alcohol recommended by UK health authorities: 14.
  • Number of pints of lager in 14 units of alcohol: 7.
  • Boston Beer Company’s revenue in 2015: $959.9 million.
  • Increase over 2014: 6 percent.
  • The Friday Mash (United Artists Edition)

    On this day in 1919, five individuals formed United Artists. They included four Hollywood notables—Mary Pickford, Charlie Chaplin, Douglas Fairbanks, and D.W. Griffith—along with attorney/statesman William Gibbs McAdoo, who later represented California in the U.S. Senate.

    And now….The Mash!

    We begin in Norcia, Italy, the birthplace of St. Benedict. The town’s ancient monastery is selling its beer to American consumer, who can also download the monks’ Gregorian chants to accompany the beer.

    Attendees at this year’s Belgium Comes to Cooperstown festival, held at Ommegang Brewing, will be able to immerse themselves in Bill Murray’s best-known movies and characters.

    The historic Grain Belt Beer sign in Minneapolis is getting a new lease on life. August Schell Brewing Company, which owns the Grain Belt brand, has bought the sign and hopes to re-light it next year.

    Meet the “Nitrogenator”. It’s the carbon dioxide-dispensing “widget” that Boston Beer Company uses for its new nitro-conditioned beer series. The Nitrogenator is manufactured by Ball Corporation.

    One of Budweiser’s ads for Super Bowl 50 features Dame Helen Mirren who, before eating a hamburger and fries washed down by a Bud, gives would-be drunk drivers a proper British scolding.

    The wave of craft brewery takeovers has prompted a movement to scrap the phrase “craft beer” and use a new term, “indie beer”, to describe small breweries that are truly independent.

    Finally, Thrillist’s Ezra Johnson-Greenough shows how to spot a fake “beer bar”. Warning signs include serving all imports in small glasses, carrying an all-nanobrewery selection, and serving all wheat beers with a slice of lemon.

    The Friday Mash (One Whale Of An Edition)

    On this day in 1820, in the South Pacific, an 80-ton whale attacked the Essex, a whaling ship from Nantucket. Herman Melville’s Moby-Dick–admit it, you read the Cliff’s Notes for that title-is in part inspired by this story.

    And now….The Mash! 

    We begin in Leeds, where two men refused to let a rainstorm, or the flooding from that storm, stop them from enjoying a pint in a pub’s beer garden. Their Sunday roast, however, was rained out.

    Dogfish Head Craft Brewery’s Sam Calagione has been named executive editor of Pallet, a quarterly magazine aimed at people who “like to think and drink.” Pallet’s subtitle is “Only interested in everything.”

    Historians have concluded that the Pilgrims didn’t have beer at the original Thanksgiving feast. That, however, shouldn’t stop you from serving beer with your Turkey Day dinner.

    Louisville plans to revive a tradition from more than a century ago: a party to celebrate the release of bock beer. The NuLu Bock Beer Festival will take place next spring.

    A beer garden made from shipping containers? It’s coming to the port city of Long Beach, California. Called SteelCraft, it will feature beer from Smog City and other local micros, along with gourmet food.

    Samuel Adams Utopias, an ultra-high-gravity (28 percent ABV), and ultra-expensive (suggested retail price: $199) beer is back. The current batch, the ninth brewed since 2002, contains previous vintages going back to 1992.

    Finally, Sadie Snyder, a Massachusetts woman who celebrated her 106th birthday, credits beer for her longevity. She had her first beer at age six thanks to her father, who worked in the beer industry.

    Update on Jim Koch’s “Alchemy and Science”

    In 2011 Boston Beer Company chairman Jim Koch recruited Alan Newman, co-founder of Magic Hat Brewing Company, to head the company’s “Alchemy and Science” venture, an incubator for developing new craft beverages.

    Four years, millions of dollars, and thousands of hours of Newman’s time have paid off. Some of those beverages are coming to market. One of them is Traveler, a line of shandies that will be distributed nationwide by the end of this year. Other graduates of the incubator include Los Angeles-based Angel City Brewing and Concrete Beach, a brewery in Miami. Those companies are based in cities Boston Beer describes as “underdeveloped craft beer markets.”

    The Winter of Jim Koch’s Discontent

    A story by beer writer Andy Crouch in Boston magazine describes how Boston Beer Company CEO Jim Koch reacted to a beer bar that left his beers of the menu. That establishment, and some others, think his Sam Adams beers are passé.

    Koch can be called a victim of his own success. Some drinkers in their 20s, who don’t remember a world before Sam Adams, are looking for beer “that is organic, local, small-batch, authentic, cool, and new.” They’re really love hoppy beers, which isn’t what Sam Adams is known for.

    Once the undisputed king of the craft-beer industry, Koch finds himself in an unsteady market. After spending 30 years battling Budweiser, Miller, and Coors, he’s now portrayed as the bad guy by some craft brewers and beer drinkers.

    Crouch points out that Koch entered the beer market when it was at its nadir, that he cleverly chose Revolutionary War figure Sam Adams as his symbol and identified his product with the city of Boston. And despite his critics, Koch grew his business to a 2 million-barrel-per-year operation, which has made him a billionaire.

    Despite the criticism, Koch is philosophical. He told Crouch, “You know, to me, one of the fun things of being a craft brewer is that people are more colorful, and we don’t have to be corporate. I can be who I am. That’s Boston Beer.”

    Is Sam Adams Too Big to Be a Craft Beer?

    There’s been a running debate as to whether Boston Beer Company, the makers of Samuel Adams, is too big to be considered a craft brewery. The debate usually centers around Boston Beer’s production, which recently topped 2 million.

    Some, however, contend that Boston Beer has lost the pioneering spirit that characterizes craft beer. Eno Sarris, a baseball statistician, is one of them, and he claims to have the numbers to back up his contention.

    Sarris’s exhibit A is Rebel IPA. According to Untappd, it’s gotten an average score of 3.0. In baseball stats lingo, Rebel IPA is below “replacement level,” which means that an Untapped user would be more satisfied with an IPA chosen at random. Sarris adds that mediocre ratings aren’t limited to Rebel IPA. In terms of Beers Above Replacment, Samuel Adams ranks 571st out of 2,673 breweries listed on Untappd.

    Sarris’s conclusion about Samuel Adams? “It started a craft beer revolution, and then craft beer’s evolution passed it by.” And the debate continues.

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