Craft Brewers Enjoy Continued Growth
Small and independent craft brewers enjoyed continued growth in the first half of 2014, according to new mid-year data released by the Brewers Association (BA), the brewer’s trade association. American craft beer production volume increased 18 percent during the first half of the year; from January through the end of June 2014, approximately 10.6 million barrels of beer were sold by craft brewers, up from 9.0 million barrels over the first half of 2013.
Now, the 18 percent growth rate is based on updated craft brewer definition and derived from comparable totals from the first half of 2013. But still, compared to recent beer data overall from AC Nielsen indicating virtually no growth in total beer sales in the U.S. expected for this year, the continued craft growth is remarkable.
“The sustained double-digit growth of the craft category shows the solidity of demand for fuller flavored beer in a variety of styles from small and independent American producers,” said Bart Watson, chief economist, Brewers Association. “Craft brewers are providing world-class, innovative products that continue to excite beer lovers and energize the industry.”
As of June 30, 2014, 3,040 breweries were now operating in the U.S., 99 percent of which were small and independent craft breweries. Additionally, there were 1,929 breweries in planning.
“Coupled with the continued rise in the number of breweries, the market growth of craft brewers highlights the ongoing localization of beer production in the United States,” said Watson. “More and more, people are enjoying the products from America’s small and independent brewers, making this country a true destination for beer.”
Big brewers continue to maintain a distribution advantage, but the larger craft brewers are continuing to overcome that advantage market to market. There seem to be two models for Big Beer left going forward: one, to buy privately- or individually-owned independents and expand their reach while not tampering with the quality of the beer. Not only AB-InBev has been practicing that method - Belgian brewer Duvel Moortgat now owns NY State’s Ommegang and a majority share of Kansas City’s successful Boulevard Brewing, a brewer whose beers are ubiquitous in that part of the country.
Then there’s a different model, one that depends on creating new beverages based on beer - shandys, canned beer cocktails - and introducing line extensions of well-known brands, mostly in order to hold the line at retail by dominating the shelves. It’s not a method that plays well on-premise, at least so it seems.
Meanwhile, operators have the luxury problem of deciding which beers to feature as more and more brews that appeal to the contemporary beer lover become available. The only question is: how many do we carry?