Where Is Craft Beer Headed Now?

And the no 1 selling beer in Belgium is Jupiler lager...

 

More haze, more adjuncts, more pastry, that's about it.

 

I have been concerned about the number of breweries too and I think that it is going to be difficult to sustain all of them. Of course, I wish all if them much success. Perhaps the key is to ensure they have local support. As for the competition, I have always been conservative and preferred the taste of beer. I do not necessarily drink to get buzzed . . . nor like Bill Clinton . . . have I ever inhaled.

 

Eventually, craft beer will no longer be one thing. Many taprooms are well on their way to replacing the old neighborhood pub, 3.2 bar or where ever people hang out. Some brewpubs are elbowing in on bistros and other dining places while other are replacing the old (and some still existing) local and regional breweries and a scant few will have a national presence and compete with the big guys and become the big guys. Meanwhile, AbInBev, Heineken, Molson Coors, Carlsberg and who ever will wander around and gobble up the crumbs. As Heraclitus, a Greek philosopher born in 544 b.c. said, “No man ever steps in the same river twice, for it's not the same river and he's not the same man.” Same goes for beer and i imagine we all will have a good time watching it happen.

 

Am I misunderstanding? Alcohol is most certainly chemically addictive.

 

That's why I say that those NEIPAs are addictive.

Cheers!

 

I guess it depends on your definitions. What I meant is most people can drink moderately for a lifetime without developing a chemical dependence, which I believe is not really possible with cigarettes or other highly addictive substances like opioids.

 

Alcohol addicts are called alcoholics. Alcohol addiction is different from heroin, for example.

Nearly everyone who uses heroin regularly becomes addicted.

That is not true for alcohol. Most regular drinkers do not become addicted.

Nicotine (personal anecdote - not scientific)... I used to use tobacco regularly and one day just stopped. I just got tired of it. Money; smell; etc. No health motivation or anything else. I just didn't want to use it anymore. I was never addicted.

Most other regular smokers I know (or have known) do become addicted, however.

 

I've been actively following this excellent thread since my response a week ago and have given it some additional thought. This comes directly from the Brewers Association website:

"Overall U.S. beer volume sales were down 1% in 2017, whereas craft brewer sales continued to grow at a rate of 5% by volume, reaching 12.7% of the U.S. beer market by volume. Craft production grew the most for microbreweries.

Retail dollar sales of craft increased 8%, up to $26.0 billion, and now account for more than 23% of the $111.4 billion U.S. beer market."

The overall alcoholic beverage market in the US is somewhat flat and while beer (overall) is losing ground both wine and distilled spirits are showing gains. These gains are coming at the expense of beer as consumer preferences change. What beer is gaining ground - Michelob Ultra - the exact opposite of pretty much any craft beer! Let's not forget spiked seltzers like White Claw that fly off the shelves (at least in my store).

That 5% annual growth means (using the rule of 72 from investing) that in 14 years craft will have 25% of the volume. I can't see that happening. To me that means that in a very short time (less than 10 years) craft will hit some sort of ceiling. At that point any new craft brewer will have to take market share away from an existing brewer. I think this may already be starting to happen in some more saturated markets. In 2017 (again from the Brewers Association site) there were 731 micro openings and 101 closings and 264 brewpub openings and 64 brewpub closings. While there will continue to be plenty of new openings, at some point I think this ratio will approach 1:1. As failure "becomes an option" I think loans will dry up and things will slow down. At that point an equilibrium will be established until the next big disruptor comes along.

While there will have to be some losers the big winners will be us consumers since the brewers who survive and thrive will do so by producing outstanding beers. I think that the smaller local people will generally be ok and the big national guys will adapt. I think the regionals will get caught in the middle and squeezed hard. If there is good local beer shelf turd producers will die.

I'll stop for now since this already screams "TLDR" but if you read this far thanks.

 

That sure didn't happen in the Repeal > Craft era, 1933 - 1980, when the number of US brewers went from over 700 down to under 50, with the Big Six of the time (AB, Miller, Schlitz, Pabst, Coors, Heileman) accounting for 85% of all beer sold in the US and beers that weren't AAL's were probably less than 2% of the market.

 

I would like to believe that to be the case but I am not so sure. Plenty of the new small. local breweries are doing well because they serve their local markets well and that could be for reasons other than the quality of the beer they are serving. Some examples of why customers might visit the tap room besides seeking high quality beer:

• Live music on the weekend
• Plenty of way to entertain themselves: pool, darts, etc.
• Trying to meet people (e.g., of the opposite sex)
• Food they enjoy eating
• etc.

As an anecdotal example: a local craft brewery opened a separate tap room in another town and they market this places as the Rec Room:

"The Rec Room by Conshohocken Brewing Company offers great beer, great food and a great time on the ping pong tables! 4 shuffleboard tables, 5 ping pong tables, and a foosball table make this the ultimate hang out right on Bridge Street in Phoenixville."

http://www.conshohockenbrewing.com/recroommain/

It just so happens Conshohocken Brewing Co. produces quality beer (IMO) but even if the beer was mediocre this place would be a thriving business.

Cheers!

 

There are miles to go yet; it's still common in rural Appalachia for the response to, "What do you have local?" to be,

"These boys won't drink that expensive stuff."

And especially in more rural areas,Yuengling is seen as pretentious.

 

Here in South Florida, we have gone from being pretty much a beer desert, back when I joined BA, to whatever it is we are now.....a culture of pastry stout hype-men-and-women, I suppose.

I still enjoy beer of course, but I can't say I'm as much of an evangelist as I once was. The crazy extra choice on the shelves and at the taps I enjoy now as opposed to 2006 is just mind-blowing. What I see now was absolutely unthinkable even 10 years ago. Even though I don't drink anywhere near as much, that aspect of beer these days is awesome. What I don't enjoy in 2019 is the prevailing beer culture. The lines, the hype, the secondary market.....all of this is off-putting to me. The legions of newly minted beer experts who sell more barrel-aged adjunct stouts and rare lambics than they bother to drink, acting like they know everything about beer when some of these guys probably have never even had a hefeweizen.

 

It seems clear to me that there has been enough growth to fully meet the demands of the 15% of us that drink craft. It is also clear from brewery closures, market retraction and consolidation that the market is now crowded and this weeds out the breweries that lack with the quality quality or the financial means to respond to the market, or both. The next phase is also easily seen as bigger craft breweries try to expand beyond the 15%. Look at Founders Solid Gold for example. This is targeting the 85% of beer drinkers who don't drink craft. This makes perfect sense since further growth depends on either a population boom (not likely) or converting some part of the 85% . As far as changes go in the types of beers, I see several trends, some which I don't personally care for. The growth in sours is one such trend. Sours just don't seem to be to my taste but there are ever more on the shelves. Lagers seem to be gaining ground as well though not with the variety of the sours. I don't mind the NEIPA trend as I enjoy these beers, but still enjoy west coast IPAs and wish breweries were brewing more Cascadian Dark Ales (Black IPAs) because I think this style has a lot to offer. But breweries seem to have abandoned the style while home breweries continue to brew various interpretations of these beers.

 

Hmm...interesting take. It's definitely trendy that's for sure. But you left out some info. The movements you mentioned got saturated and thus those early adopters felt crowded out and got tired of the hipsters and tourists...I get it. But what did they escape to? What replaced it for them? Hipsters and late adopters are creating a greater market...greater market means more breweries and more varieties IMO. Plus...if you get tired of the whole thing, what do you gravitate to instead? Certainly not back to the mainstream AAL offerings that i gather none of us here enjoy.

 

Hey guys and gals, first time posting on anything on the web so be patient with me. Retired from being a computer tech and the last thing I wanted to do is go home and sit in front of a computer. With that said I've tasted a lot of different beers, even lived in Germany for 18 months in the service, and I've always liked "dark " beer. Now I get to taste things like Porters and the like. Without the craft brewing I would of not been able to sample these without traveling a lot. I live in Minnesota and love the Edmond Fitzgerald Porter. I just had a liter of Surly Darkness. It was very good, but not $22.00 a bottle good. I know it's a limited edition brew, but that's a lot of money for one bottle of beer. I am not a "beer pro", I just know what I like. I wish the industry would start putting out 12 packs that are not different kinds in one 12 pack. It does get expensive paying $10.00 to $12.00 for a 6 pack. Just my 2 cents, take it for what it's worth. Maybe I'm even off topic.

 

There's also some data showing in one or more demographics that increasing numbers of people are passing on alcoholic beverages entirely.