Where Is Craft Beer Headed Now?

Data, please.

 

Dave, where do you think ABI’s growth will occur? Will they sell more Bud in China?

“Beer consumption continues to decline in the U.S. and in Brazil: AB InBev's two largest markets and ones where it holds the No. 1 market share for beer by volume. And there are no signs of improvement.”

https://www.fool.com/investing/2018/11/02/anheuser-busch-inbev-halves-its-dividend-as-its-ac.aspx

Cheers!

 

You'll need a copy of the B.A.'s THE NEW BREWER May/June issue for some of that info - mostly actual barrelage by brewer, not brand, and not dollar share (which I imagine are estimates and, given that "craft" has a larger percentage of "on premise" sales, is just as inaccurate a view of the total market as volume only).

Some of the brand barrelage (Top 20) and brewer info can be found on the right side bar "Key Industry Data" at Beer Marketers Insights.

More specific dollar share and brand info is usually gonna cost you - beer market research reports that go for $2.5k or so.

 

I will have to keep an eye out here. Maybe AB can successfully sell their 'crafty' beers overseas?

Cheers!

 

AB did try about every legal approach to killing craft and even some illegal ones. And the best times for AB were in the 80's with growing demand and a 50% market share. Their future is very cloudy and not pleasing to investors. I suspect that you don't realize the real crisis in big beer and AB in particular. When you are a giant financials driven company its about dollars and beer is an afterthought. Look at these US market share nos. AB '07: 48.3%, '17: 41.6%; MillerCoors '07: 29.4%, '17: 24.3%; Heineken '07: 4.1%, '17: 3.8%; Pabst '07: 2.8%, '17: 2.3%. Bud Light sales: more than 2x the sales of Bud. They sell more Bud in China than in the US. And US bbl shipments AB '90: maybe about 100 Mil bbl; '07: 104.4 Mil bbl, '17; 96.7 Mil. That is over a 7% shrinkage in AB US. They have been in crisis in the US when they need to grow for Wall St - thus the InBev merger and then the SAB merger. The US is now only the #3 world region for their production. They as a company and industry are desperate to find something positive in the largest consumer market in the world and they haven't seen anything positive in 10 years.

 

I am a bit of a market newbie when it comes to big beer. I know that big beer has been buying up great craft breweries. To what extent do you think this will continue with international companies, especially from the orient, like what has happened with bourbon?

 

That's 6 drinks with the 5% beer vs 5.1 drinks with the 6.5% beer per the calculator in this link .....

https://www.rethinkingdrinking.niaaa.nih.gov/tools/Calculators/drink-size-calculator.aspx

..... which is 15% less of the 6.5% beer by my calculation. A 4th pint, though, reverses that.

 

Interestingly my area is now home of a craft brewery from east Asia. They purchased an intact brewhouse to supply increased demand in their home market and have slowly been expanding their offerings in the California market. Not that I expect more of this, or any major moves into American craft beer from Asia, but I do suspect that demand for the more diverse beer flavors is growing fast over there. (as has been stated often, it's easy to have massive growth from zero)

 

I did say "almost". 3 is slightly less; 4 is more.

 

AB never quite hit 50% (damn close, tho' - 49+% in early 2000s, pre-Inbev).

AB started the '80s with 30% market share and a barrelage of 54.5M bbl in 1981. By 1990, they were at 44.6% / 85.5M bbl. Pretty impressive, anyway, since that was the era of the Big Six in the US brewing, not the current Big Two. The others except Coors either lost share or, for Miller, was stagnant.

sources: Maxwell/Wheat First Securities
R.S. Weinberg

 

Bud has announced they are done buying craft in the US and they laid off the staff working that. They own 250 brands around the world. Either here or int'l I think they have they distro, so prob. not many opps to better their network. Maybe a int'l few brands that have real volume and just maybe a US craft that is "just right" - but there really isn't many places for them to go to make an important acquisition.

 

Wow you're a stickler. Yes, functionally 50% but precisely a fraction short. Augustus Busch took out his father in a coup in '75 and killed it for 25 yrs. In '50 Schlitz was #1 w/ 5.1 Mil bbl, AB at 4.93, by '60 AB at 8.48, Schlitz at 5.69. AB never looked back - barrels (Mil): '70 - 22.2; '80 - 50.2; '90 - 86.5; '00 - 99.2; by '10 flat at 102.1; & down in '07 to 89.6. By '90 they were 2x the size of Miller (within a fraction) so it was already the beast, a remote 2d (with no hope to catch up) and the rest. Don't quibble about discrepancies yours nos. and mine. Source for those nos. a recent review of biggest brewers by decade. I can't seem to find any perfectly consistent bbl numbers or a source for definitive numbers - even for '17 where I see some of the biggest discrepancies.

 

Yeah, its always been pretty common for the yearly barrelage numbers to vary from source to source for a number of different, valid reasons - and they are often updated after the initial reports in the spring of the following.

Sometimes due to returns, rounding off, difference between shipments and production, source estimates because the company is privately held, etc. Some sources' market share percentages were based on the domestic market share of US brewers (only), and did not count imports as part of the overall market. That created only minor differences between sources until imports gained a more significant portion of the market in the 1990s.

The only reason I pointed out (quibbled) that "...AB never quite hit 50%..." was for emphasis - it had long been something that they always wanted to reach and they got within a few tenths of a point a few years prior to the InBev takeover. (The stats that ignored imports had AB over 50% starting in 1998).

 

AB understands making money, if it’s thru crappy Bud Light so be it. It’s a commodity, it’s about pleasing share holders, it’s certinly not about making a great beer. Most certinly if they chose to do so AB could brew a great beer in any style. They choose to placate the 95% of the beer drinkers, if its my business I would do the same. There’s a big difference between making money vs making great beers, they’re obviously not the same, look at the sales charts.

 

I am with you 100%. Recently went to the Modern Times in Encinitas for the first with a friend. The beer is great but the environment was so far removed from what I like and look for we both said we would never go back. I’ll buy modern time later and drink it from the comfort of my home.

 

I've seen drunkeness at festivals, but honestly in all of my brewery taproom visits, I can't recall seeing anyone really smashed. Perhaps its the fact I rarely go later in the evening near closing time. I'm usually visiting early evening on weekdays or afternoons on weekends so that probably plays alot into it.

For "non college aged /non-event" public drunkeness at a food/beverage establishment by adults, the worst I've seen (mulitple occassions) is at a restaurant on the Chesapeake bay where boaters dock up partake in food and drink. Saturday or Sunday afternoons when the weather is good, there are so many smashed, staggerring "grey beards and floozies" all around that place in late afternoon/evening. Something about wealthy people with boats makes them drink to crazy levels or something. I just frequently stop at this place for food on the way back from the beach as its the 1/2 way point home and great deck bar overlooking the Bay. People watching is a laugh as well.

 

As @cavedave has said, I had a few friends over from Asia and prepared many styles of stouts.

The only ones they were interested in were the GI’s stouts; they bypassed canuckley, kentuckley, black tuesday reserve and many others because the GI brand was already in movement overseas and they were familiar with how good & rare they are.

 

Egg in beer is new again?