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Craft beer in 10 years

Discussion in 'Beer Talk' started by Shagtastic, Apr 17, 2012.

  1. Ten years from now the craft beer business will still be fighting for incremental increases in market share. Many recent startup breweries will, sadly, have failed. Quality craft beer will survive, but most people will still be drinking Corrs f-ing Light
     
  2. Chugs13

    Chugs13 Savant (440) New Jersey Dec 11, 2011

    This is what I fear the, but you can never underestimate the power of American ignorance.
     
  3. KBS will be on the shelves 24/7 and Mother of All Storms will gush out of all water fountains around the world.
     
  4. bubseymour

    bubseymour Advocate (685) Maryland Oct 30, 2010

    ...only true if the monopolizing middleman distributors aren't involved in bringing the beer to market. My local beers sold just 1 block from the brewer cost equal or more per 6-pack to comparable beers by brewers a 1000 miles away. Thanks to the distributor BS. Shouldn't be that way.
     
    Auror and TheFlern like this.
  5. The "craft" breweries would pretty much follow a power law.
     
  6. BigPlay1824

    BigPlay1824 Savant (400) New York Oct 13, 2010

    to me, this is a bit of a daunting and terrifying idea. i have this fear, which many others on this site have expressed, that as crafts get more popular we will see a tremendous influx in breweries, brewpubs, etc. this, IMO will lead to a horendous amount of mediocre beers on the market which will devalue and undercut the quality brews that we have now. im fearful that craft beers have become "cool" and thus are "mainstream". what i mean by this is that there are people out there right now speaking on be half of craft beer and those of us who really enjoy and appreciate it. these people are taking away our validity by spewing their, quite frankly, uninformed and underdeveloped "beer knowledge". i fear, craft beer may become a victim of its own success. i pray that iam 100% wrong on this but honestly fear that im right
     
    yemenmocha likes this.
  7. yemenmocha

    yemenmocha Poobah (1,115) Arizona Jun 18, 2002

    That and more factors, but the same holds true here. My "locals" are about $9/sixpack. Just bought one of each new Celis beer that came into AZ recently (Celis White, Gran Cru, Pale Bock, Rasp) and they were $6.49. As I've noted in other threads (and posted the ad) we often see Sam Adams & Sierra Nevada 12packs for around $10-11 on regular specials at grocery stores. There's quite a few $1/bottle craft beers in AZ, but none are local.
     
  8. dwaz

    dwaz Savant (280) Pennsylvania Jan 18, 2008

    This exactly! The craft beer world will not implode any time soon. Sure there will be some brewereis with bad business plans/poor beer that will fold, but that happens in every industry. Breweries that make mediocre beer will survive, just look at the wine industry; not all wineries make world class wine(some just make mediocre wine), yet they survive and thrive. The same thing is going to happen with craft beer.

    Look in the mirror and you're own journey into craft beer, how long did it take you to refine your palate? Really appreciate world class/even good beer? There will always be a market of Americans that want and apprecaite mediocre beer that is not BMC, and that's okay, not everyonre needs to want/appreciate KBS or Pliny. It will keep the craft industry healthy and the number of craft breweries expanding. How many flagship beers does a brewery actually need to produce to thrive? Not everyone can or should be Founders(have never had a bad beer from them). I say a brewery that produces 2 or 3 solid beers, flagship beers, will continue to thrive.

    And if I learned anything from this entire discussion, it's this: Yemenmocha needs to get the fuck out of Arizona. I think he would be much happier in a craft mecca like Philly, Portland or SD.
     
    yemenmocha likes this.
  9. cpinto6

    cpinto6 Savant (365) Georgia Feb 25, 2010

    Ummm yes it is a bubble...do you not understand what that is? When the housing bubble burst it didn't change to no one wanting good homes. It changed to no one wanting to pay the market price for a shitty house relative to the price. I know at least in Miami, houses were selling like water at ridiculously high prices. Houses that ordinarily no one would pay more than 5k for were being bought up for 1M and more.

    Same thing here...shitty beers relative to their price are being bought up left and right. Bubble bursts, no more shitty beers get bought up and that will be bad for the breweries producing those lower quality beers. Although I read an interview with Wayne Wambles today and a little tidbit I didn't know, demand for raw materials is also gonna outpace supply soon, with hops before grains but eventually grains too since breweries are popping up like mushrooms. They already have to allocate for hops years in advance to make sure they'll be able to still produce their flagships. So we may get to the point where breweries can't get the raw materials to produce their mediocre beers that people are still buying before we get to the point that customers aren't buying mediocre product anymore.
     
  10. ^^^This. I recently read in the Fraenkischer Tag newspaper that the barley growers around Bamberg are having trouble supplying local breweries. If people here don't think that German locals will rebel against such a trend then they are sorely mistaken; Franconians revolted in the early 1900s about a 1 pfennig (1 cent) increase on beer taxes and took to the streets. It's that serious over there. We may pretend we live in an isolationist bubble here in the U.S., but we do not; and we are most certainly living in a craft brew economic bubble....
     
  11. travMI13

    travMI13 Savant (355) Michigan Jan 7, 2012

    No, I don't. Most non-BA's that I am friends with seem to prefer more mediocre, local brewpubs because they can get something that is closer to BMC. I have no problem trying and even enjoying things from places like this. Most times, I am pleasantly surprised by one of their offerings. Not everyone I know wants to make the extra drive to get somewhere outstanding like Kuhnhenn or Jolly Pumpkin, so I make due, and I am happy with that.

    What I purchase for at-home consumption and what I drink when out with friends (non-BA's especially) are generally 2 totally different things.

    What I am trying to get at is that local brewpubs, even ones that don't produce world-class beer, have their place.
     
  12. cpinto6

    cpinto6 Savant (365) Georgia Feb 25, 2010

    They don't have to produce world-class beer but they won't survive producing mediocre craft beer, that means beers that don't appeal to BMC drinkers. It just has to be somewhere between good and world-class.
     
  13. If new breweries/brewpubs that opened this year can't get the Amarillo, Cantennial, Citra, Simcoe, then where are the 900+ in the planning stages going to get theirs? The barley malt crop was a little shy this last year. What happens if there is a really bad year?

    There are plans for US style brewpubs in India, one is to open this year. They will use American hops in the beers. If this were to take off in India and China, hops will really be in short supply.
     
  14. BlindSalimander

    BlindSalimander Savant (250) Texas Aug 16, 2010

    Not only will BMC continue to expand their market share of craft beer through their own lines and purchases but the craft brewers will participate in the consolidation of the market as well. Take a look at a couple of the responses from Tony Magee at Lagunitas in that article that was posted in the Lagunitas Sucks thread. He takes a couple veiled shots at SN and NB for expanding outside their "normal" lineups by introducing IPAs.

    http://beerpulse.com/2012/04/laguni...ing-founder-sounds-off-on-craft-beer-industry

    Interviewer: Still the #1 IPA in California I believe, right?
    Magee: It was until that other big brewery started driving in the rearview mirror and decided that they had to be making an IPA, too. And they have such incredible distribution relationships that they were able to make it more popular in the grocery stores. But I think if you added up all the barrels, kegs as well as cases, still more of our IPA is drunk than anyone else’s. That’s alright. There are still a lot of great beers. The reason that ours may be more enjoyed is because we have been making that IPA exactly the way it is now since ’96. And in ’96, believe it or not, it was one of the hoppiest things that anyone had ever tasted. The palate has come so far down the road, it’s unbelievable.
    On Barrel-aging, trend-watching (and New Belgium):
    Magee: I think barrel-aging is a wonderful thing and I think that smaller brewers that want to mess with that…it’s an unplowed furrow. But I don’t need to plow every furrow. If somebody else is pioneering that stuff and making skills around it, what do I want to fill into their market for? Who is that brewery in Colorado that makes that sort of strange amber ale? When I see them all of a sudden making an IPA and they never put hops in their beers, what is it that they’re really trying to do? Oh, I see. They’re driving in the rearview mirror while trying to cut off other brewers from finding daylight. It’s odd. The things that they did worked very well for them. Why do they have to do what others are doing? It’s kind of Budweiser-ish.
     
  15. cpinto6

    cpinto6 Savant (365) Georgia Feb 25, 2010

    You're asking the wrong person...I don't know what will happen besides that the shit will hit the fan. I'm not an expert on the subject, I'm just providing input based on what a brewer has said to be a problem more so than saturating the market. I understood it was the way things are now, there isn't enough raw material to even saturate the market.

    P.S. according to what Wayne said, I interpret it as hops are already predicted to be in short supply just with current breweries predicted to scale up.
     
  16. MLucky

    MLucky Savant (380) California Jul 31, 2010

    Um, I disagree. The comparison to the housing bubble is not valid. To begin with, in the housing bubble, pretty much all housing increased in assessed value dramatically--where I live it went up by more than 20% per year for almost a decade. This has not happened with beer. If it had, a sixer of Bud would now cost about $20.

    You see, I do know what a bubble is. It's a situation in which market prices are unsustainably high. Beer prices are not unsustainably high. I see no reason why they can't continue at their present level, or even increase. This is why I wouldn't call it a bubble.

    When a brewery overprices its beers, that isn't a bubble, even if people buy them. That is just overpricing. If that brewery can't make beer and sell it at a price people are willing to pay, it will go out of business, but that isn't a bubble, either. If a brewery makes what you think is bad beer, but people are willing to buy it, that isn't a bubble either. That's just a disagreement of opinion as to the quality of the beer.
     
  17. cpinto6

    cpinto6 Savant (365) Georgia Feb 25, 2010

    Housing bubble was just the 1st thing that came to mind. As breweries like GI, Lagunitas, SN, SA expand and consumers wise up it will become unsustainable pricing because no one will pay them knowing they can get better beer for the same price or cheaper. As for your disagreement of opinion as to quality of the beer I have two words...White Birch, how the hell are they not outta business yet? It is a bubble when it supports products that wouldn't ordinarily get bought up. I've stopped buying a lot of new beers or trading for them because its not worth it when I end up thinking hmm I could've gone to my local store or even gas station in the case of SN and gotten better beer. This will become more and more prevalent as excelling breweries distributions get larger and larger and their pricing gets even better than it already is.
     
  18. cavedave

    cavedave Champion (940) New York Mar 12, 2009

    When fuel costs skyrocket, the less transportation needed to bring the beer to the consumer, the less the cost of selling the beer. The lowest costs will be for beer produced and consumed in states that grow grains used in beer. High transportation costs will favor locally produced merchandise in every industry, not just beer.

    China better learn to be a non-exporter, or hope North Korea becomes a nation that imports, because their present model of shipping across ocean to receive raw materials and sell finished products will not work in a world of skyrocketing transpo fuel costs.
     
  19. I'm not sure that the "quality" of the beer (a subjective term in itself) is as vital a criterion as many posters believe.Over 90% of beer sold in the US is, I believe macro lager which many of the same posters do not consider to be good beer.
    It's a matter of taste and you only have to look at the Old World to see this.In the past the everyday beer was roughly equivalent to modern craft beer......in my own country very strong and often incredibly hopped.What happened? Traditional beer now accounts for roughly 15% of the market and bland pseudo lager holds centre stage.There is a market for tasty and characterful beers , a large one too, but it isn't going to threaten the establishment.
     
  20. rlcoffey

    rlcoffey Savant (490) Kentucky Apr 20, 2004

    You might be right about beer geeks, but I have a dark mild I semi-regularly make for a derby party (its ready to go this year). The party is large and hosted by family of a friend of mine, most of the people at it I dont know and/or only see once per year. And they ask for my dark mild by name and are disappointed in the years I dont bring it.

    So, it is popular with both craft beer drinkers (some of whom are beer geeks, so I question even #2) and with people who regularly drink Bud Light but are willing to be adventurous.
     
  21. rlcoffey

    rlcoffey Savant (490) Kentucky Apr 20, 2004

    Isnt Michigan Brewing the ones that put out Celis White? If so, its well above mediocre. Its probably my 2nd favorite wit. And I havent directly compared it with St Bernardus, so it might be my favorite.
     
  22. chcfan

    chcfan Advocate (570) California Oct 29, 2008

    I think this holds even more true with brewpubs, which I believe account for well over half of the ~2000 "breweries" in the US. You can make average beer and food and people will still go for some reason.

    Edit: I'm all for eating local mostly because of freshness, but I only believe in drinking local if the beer is good. It keeps much better than meat, fruit, and vegetables.
     
  23. rlcoffey

    rlcoffey Savant (490) Kentucky Apr 20, 2004

    Not really. Compare the brewery opening/closing numbers over the last few years to the brewpub numbers. Lots and lots of brewpubs close every year. There hasnt been much growth. Over the last 5 years or so, very few breweries have closed, on the other hand.

    I dont have the brewers association numbers for 2011, but here are the few previous years:

    2010 55 brewpubs open, 33 close
    2009 49 open, 40 close
    2008 70 open, 46 close
    2007 66 open, 56 close

    compare to breweries:
    2010 97 open, 8 close
    2009 69 open, 15 close
    2008 58 open, 15 close
    2007 58 open, 22 close

    Brewpubs can survive with mediocre beer. They cant survive with mediocre food, generally.
     
  24. chcfan

    chcfan Advocate (570) California Oct 29, 2008

    I'm just speaking from experience of my locals in the few places I've lived. About half of the brewpubs are mediocre in both food and beer yet seem to be doing quite well.
     
  25. No offense, but that comment in particular makes me think that you have no understanding of what the movement is about. I think there are a lot of synergies between this movement and the craft beer movement, and if there isn't any good local beer in your market today that doesn't mean that tomorrow or the next day local beers won't be among your best and freshest options.
     
  26. IMHO Wormtown, Jack's Abby, and Blatant are doing excellent and affordable beers as is Baxter Brewing (if you consider ME local), and more expensive but worth it are Mystic and Idle Hands. I'm not at all seeing this "vast majority of which are not very good", at least among the brewers that have started up recently.
     
  27. People do purchase lousy national beer. That's a fact. On the national scale, the people buying lousy beer haven't stopped the good stuff from eventually coming to market, and the same should be true on a local scale, too.
     
  28. That was something of a rhetorical question. I was agreeing with Wayne Wambles in an indirect way. The hops I mentioned are in short supply this year. Those have limited acres planted, but the demand is high. Those hops get more $/pound, so the farmers and the hop patent/trademark owners have an interest in not overplanting and saturating their market for hops.

    I know some guys who have opened brewpubs/brewries. Getting the hops they want the first year is tough, and they have to adjust their recipes or not brew that ale that they were making as a homebrewer due to the large amount you need for a commercial batch.
     
  29. MLucky

    MLucky Savant (380) California Jul 31, 2010

    I think you're confusing "boom" and "bubble." What craft beer is experiencing now is a boom: a period of unsustainable growth. If you're growing at 12-20% per year, at some point it's going to slow and some of the more poorly managed companies that have been riding the boom are going to go under. That's nothing new. It happens in most industries and it's happened in craft beer before. I don't know why it makes you angry (apparently) that some people are currently supporting some beers you deem unworthy of support, but ... whatever.

    If we want to guess what's going to happen in craft beer, we should look at similar industries that have gone through booms. (Housing is not similar. Consumer behavior in that industry is dependent upon the availability of credit, as we can see looking at how the recent boom was caused by manipulation of the credit market.) Look at coffee: 35 years ago, if you wanted a cup of coffee, you paid 50 cents and got low quality, industrial product like Folgers. If you told people at that time that within a couple decades, they would gladly pay $3.50 every morning for a mocha latte, they wouldn't have known what a mocha latte was, and they wouldn't have believed they would ever pay that much. But an interesting thing happened: people were exposed to better coffee, and they developed a taste for it, and they decided they were willing to pay more. The industry boomed, with huge growth year after year, and we went very quickly from a situation where you could only get a decent espresso in a few ethnic neighborhoods in the biggest cities to what we have now, where every town has a couple Starbucks and you can get high-quality coffee from numerous grocery stores, convenience stores, chains, mom n pops, and even now McDonalds and Duncan Donuts. It wasn't a bubble. The market expanded. Sure, there were some contractions, too, and some poorly run coffee shops went under, and even Starbucks had to contract at one point. But basically, the market is completely transformed from what it was in 1980. I think the same sorts of things are happening with craft beer. We're seeing a boom that is resulting in much greater selection/avaliability and the creation of a market of more sophisticated consumers who are willing to pay more for what they want. It stands to reason that at some point we'll have a plateau, because you can't keep booming forever. But it's not like this is a bubble, and when it bursts suddenly it'll be like 1980 again. The market is changed, and so is the industry.
     
    cavedave, DavoleBomb and rlcoffey like this.
  30. Bonis

    Bonis Savant (410) Ohio Jul 28, 2010

    I personally think the local scenes will grow stronger in the next 10 years. Like someone else mentioned, shipping and distribution costs will keep a lot of beer local. And it IS good beer! I don't understand people who are looking for perfection in every beer they drink. I could pick out many local beers that are better than what breweries like SN, Stone, and Sam Adams are putting out. Ever tried a Columbus IPA or how about Barley's Barleywine? Just because it is a small brewery doesn't mean they are putting out inferior products compared to the big(ger) guys.. Most of my experience is that a lot of the stuff is better. The fact of the matter is that these small breweries either don't want to expand or they don't have the means to expand into a bigger brewery. I think local is here to stay...
     
  31. NiceTaps

    NiceTaps Savant (470) New Jersey Nov 21, 2011

    The craft beer industry is bound to see changes in the next ten years. Things go in cycles.

    I remember the microbrew bust of the mid-nineties, let's hope it doesn't happen again.
     
  32. YaKnowBrady

    YaKnowBrady Initiate (0) New Jersey Jul 23, 2010

    Drinking beer out of LASERS!
     
  33. cpinto6

    cpinto6 Savant (365) Georgia Feb 25, 2010

    Who said it made me angry? I just know there are many beers out there that there is a consensus that they aren't as good as others. Those beers will stop being bought when you have too many awesome options readily available for better prices from california or chicago or wherever it is. I've tasted way too many hoppy beers that I think this just tastes like water and hops, its pretty bland. Then there are other beers that I'm like ok this just isn't for me but it does have a lot of flavor and I can see why other people like it, like dirty bastard and backwoods from founder's. It doesn't piss me off that breweries are selling mediocre beers, it just makes me wonder how long until everyone has a lot of much better options and they stop being bought.

    I don't think your coffee example s comparable either because there's a couple big players selling much better coffee and that's it. You don't see Starbucks-esque being opened under different brand names in every city and them popping up like mushrooms. That is exactly what we are seeing with breweries...everyone into beer that has a little cash to spend is opening a brewery. I obviously don't mean literally everyone, just a shit ton of people.
     
  34. DavoleBomb

    DavoleBomb Advocate (615) Ohio Mar 29, 2008

    You guys suck. I'm taking a more optomistic approach and saying that in 10 years, growth will finally start declining (but not stop) and craft beer will be 15% of the total beer volume. All the breweries that are opening now that don't completely suck will be doing fine. Around a couple dozen breweries will be about as big as SN and SA are now.
     
  35. goodonezach

    goodonezach Initiate (0) New York Mar 24, 2011

    there are a lot of "local" places that make mediocre brews, and they'll either have to get better or go under. that said, i can't see too many seriously great breweries expanding like crazy. i think what will happen is a lot of great local brewpubs are going to pop up, and drinking local won't be an excuse to drink mediocre beer anymore. it will be the way most people drink, since there won't be a need to drive/trade across the country for beer if equally good beer is available locally.
     
  36. mistaforty

    mistaforty Disciple (55) Maryland Apr 15, 2012

    i think this boom is similar to the cigar boom of the 90s and that in ten years what will change the most is the places that offer craft beers. this bubble will burst, makers will be forced to close shop (as many cigar manufacturers did) and the exclusivity willl return for those that truly loved the brews while those that drank them because it was a cool thing to do, fall off. those brewers that developed strong enough followings will endure
     
  37. Any one have any idea of a method to short the craft beer industry? I'll love to short the shit out of this bubble and get rich. I've seen the original numbers put out by BA, and I'm calling BS.
     
    dukes likes this.
  38. dukes

    dukes Aficionado (180) Apr 2, 2012

    If you can buy wine futures, I'm sure there's a way to short beer
     
  39. Living up in Canada, we don't get too many US craft beers. By the time 10 years has gone by hopefully that will be changed.
     
  40. klaybie

    klaybie Savant (275) Illinois Nov 15, 2009

    In 10 years I'm hoping the 5.8% is more like the 58% (wishful I know)...and also more FW, FFF, RR and Cantillon for everyone...
     

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