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The Beer War on American Soil
Wolf Richter www.testosteronepit.com
Disclosure: I love beer. Particularly certain kinds of what the industry calls craft beer. I’m a sucker for a good IPA, or an amber, or a pale ale. For special occasions, there is the expensive stuff. If I’m traveling, I try to discover local brews. And the first swig is one of the simplest great pleasures in life. But for now, I’ll stick to the numbers. And they’re morose for the US beer industry. Yet there is an astonishing exception: craft brewers.
There are a lot of them in the US: 1,989 last year, up 11% from prior year, and up from one in 1976, according to the Brewer’s Almanac. They employed 103,500 workers. 250 new breweries opened and 37 closed—it's still dog-eat-dog out there, and just because you know how to brew a good beer doesn't mean you get to stick around. The phenomenal re-birth of an ancient industry:
“These numbers are poised to rise even more in 2012,” said Paul Gatza, director of the Brewers Association, which represents small and independent brewers. “In February 2012, we already topped 2,000 operating breweries—a truly remarkable milestone.”
But before we get too tangled up in false euphoria about the American beer market, and the idea that it had somehow escaped the great recession, or has even emerged from it, let’s contemplate its possibly permanent misery.
Beer’s tragic fate: it used to be by far the favorite American alcoholic beverage. Even in 1992, long after wine had started climbing the popularity ladder, 47% of alcohol-consuming adults preferred beer; only 27% preferred wine, and 21% liquor. We know because Gallup began sorting out our alcohol preferences that year. Since them, beer zigzagged down and in 2005 plummeted to 36%, the lowest level of recorded Gallup history. Wine spiked to 39% to become America’s favorite drink. Then beer recovered but soon fell again, and in 2011, it was back at its record low of 35%, neck and neck with wine at 36%.
Preferences expressed in a survey don’t always translate well into gallons, barrels, and dollars. So here is a good swig of American reality: annual per-capita beer consumption. It makes mass-market brewers want to cry. There is no light at the end of the tunnel, no flattening out of the curve. America has been turning away from their product for over two decades:
In the good old days, US brewers fretted about imports, but over the last few years, imports have actually lost market share and are now down to 12.8%. For some astounding worldwide beer trends, read.... PROST! Germany Lost the Beer War, and China Won.
These days, what gives US brewers conniptions is the sheer terror of collapsing per capita consumption, an enemy they can’t shake. So far, they’ve had a powerful ally that helped obscure it on their income statements: population growth. A whopping 24% since 1990. But that is slowing down, and US beer production is getting slammed.
Three multinational corporations own most of the 20 gigantic, highly industrialized breweries that produce the vast majority of American beer. It’s been a great Wall Street bonanza, but the results are sobering. The largest brewer in the US, Anheuser-Busch, belongs to Brazilian multinational InBev, the largest brewer in the world. American number two, Miller, is part of SABMiller, headquartered in London, the second largest brewer in the world. Coors was acquired by Canadian brewer Molson, now the Molson Coors Brewing Company, fifth largest in the world. As if that weren’t enough deal-making, SABMiller and Molson Coors Brewing Company formed the joint venture MillerCoors. However, Pabst Brewing Company is still independent.
But craft beer brewers operate in their own micro climate. In 2011, production jumped 13% to 11,468,152 barrels, for a 5.7% share of the US beer market in volume, according to the Brewers Association. With craft beers being more expensive, retail sales jumped 14.5% to a record $8.7 billion—for a 9.1% share of the $95.5 billion US beer market.
Despite the fundamental moroseness of the beer industry, it’s been an awesome year for craft brewers. What it shows is just how successful American entrepreneurs can be with their scrappy outfits in an industry of giants.
Beer’s archenemy wine got clobbered worldwide during the great recession and is still getting clobbered in Europe. But American wine makers are proving to be the toughest competitors out there, and they have prospered and grown despite the mayhem around them. For the debacle that old-world wine makers find themselves in, and for what they sheepishly consider an inexplicable American phenomenon, read.... Liquid Economic Indicators.
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Too right mate!
Any mass produced beer is pure shite! Poison from chemists.
I inherited my Pappy's beer making fixins, as he got it from Grandpappy. Complete with recipes handed down throguh the generations. We learned early at our Papps elbow, the ins and outs of making not just good beer, but great beer!
It brought the family through the 'Dirty Thirties' back when it was known as bootlegging! Finest brew in the county.
Follow the seasons boys ~ the finest hops made beer in Summer, fresh malted barley beer in the Fall, Winter wheat beer, with a 'special' Christmas stout that comes at you like a silent bulldozer! And finally rounding out the year, clean out the oat bin for a truly full bodied brew that will keep you Spring plowing all day long.
Follow the seasons as our forebearers did and do for yourself. Don't poison yourself with that store shite.
Dead Guy works.
The local craft brewer in my hometown just closed his doors finally after trying to stay afloat by taking up to $1 million in loans...sad story and a sad end to a great family business...demand just totally dried up on him.
IT's hardly surprising the micro-brews have been taking off. American national-brand beers are a joke - and an embarrassing one at that; quite possibly the very worst in the world - and that is no hyperbole.
You'd think, for instance, that Bud would have gotten it thru their thick skulls by now - that along with all the incessant in-your-face hype (plastering their name over every sporting event known to man, and ads of draught-horses frollicking in the snow) there has to be an ACTUAL product.... something that doesnt taste like frothy sh!t, is as weak as virgin p!ss and is full of crap ingredients (rice? Helloooo......???) that almost guarantee a raging hangover & gut-rot afer just a couple of cans!
American national brand beer? You can keep it...... please!.
While I don't drink Bud or the big nationals anymore, I do want to stick up for what they do. They make a remarkably consistent product over millions of barrels. As a homebrewer, I can tell you that consistent batches are not easy, especially the lighter the beer. Lagers are especially challenging because you can taste any flaw.
No, I'd rather have a glass of water than Miller Lite, but give them credit for serving the needs of millions of Americans who don't know any better.
All those who agree say "Burp!"
American "Beer", with the exception of the craft breweries, is an oxymoron.
Gav in Germany
Don't worry. The government will outlaw small breweries "for our safety." We can't have the consumer making decisions for himself, stealing profit from the megacorporations.
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Compare gold and silver prices
moved by a rare burst of patriotic fervor he opened his refrigerator door and opened a beer...
moved by a rare burst of patriotic fervor he kicked open his refrigerator door and, after removing the cat, cracked a cold one...
- Fixed ;)
Even a little alcohol consumption is an excuse to avoid reality in some way or another. A drunk is just a wasted life.
Yes, I especially hate the way it raises my HDL cholesterol and helps protect me from heart trouble. And, my goodness, the horrible taste of a fresh, lovingly-brewed Hefeweizen. Oh Yuck! I think I'll have another! No, wait, one is my limit. Guess you bluenoses and "recovering" addicts never heard of moderation?
true that hefe
best US version is 'circusboy' by magic hat
I've heard that drinking beer makes you smart - well, after all, it did make Bud wiser....
Europeans beers are the best!! 2000 Years of experience vs 100's or just a few for Canadian/American breweries or Brazilian or Mexican for that matter....Beers were made in the alps region many many years ago....
Czcheks, German Pilsners are the best!!
Irish beers are great! I do realize it is a very personal taste like wine, so enjoy whatever you like!
By the way booze is a great investment, some people are starting to stock up! screw gold or PM's as an investmentt they are just beginning their trip to oblivion in the next few years, Paper has won the battle for the time being , Gold revival successfully pushed out at least 4 years.
As soon as they could, after the WWII, my parents sent packages to relatives in Germany. One relative owned a small brewery and only wanted a few samples of U.S. beer to run through his lab. After sending the samples my parents received a letter from Germany saying that the lab stated that if they made beer like that they'd end up in jail.
And my favorite beer is Optimator, try it if you like a tasty black beer. Also, try some of the German wheat beers, with a slice of lemon of course.
Dont forget Belgian Trappist and Dutch hop - based. If you're not familiar with that, you're in for a treat!
Two personal faves:
http://www.desnaterendearend.nl/
http://www.brasserie-dupont.com/dupont/en/7002-biere-de-miel-bio.html
Beer (organic ones) are VERY HEALTHY. They made up the diet of human beings in europe since the stone ages (not exaggeration)
http://io9.com/5734276/the-recipe-for-2500+year+old-celtic-beer
And the effect on the psyche is very enjoyable, compared to mass produced beer. VERY DIFFERENT!
when the shit hit the fan the monestaries took in and maintained brewing like they took in everything else. The church has a long tradition of drunks and good breweries.
I am a drunk in the company of drunks. Cheers!!!
Tyler, may i suggest a ZH survey on alcohol consumption of the membership. I am curious for several reasons.
One per day. Either a half-liter of Wheat beer (usually), or a glass of red wine, or a shot of Maker's. All in moderation, and all for my health and well-being.
Sorry, stych, I hear diabetes is a fucking bitch. Thank for reminding me to hit the gym and avoid the potatos tonight!
Had to cut way back several years ago; it fscks up my blood-sugar level. Once the Great Implosion™ hits, I intend to down at least 4 glasses of Absinthe (drown my sorrows).
Greetings ZH fuckers. RsNoble at your service. I brew my own beer. Of my favorite mainstream crap........bud lite and Millerlite. What? Watered down? You drink like I do and you'll appreciate that. 99% of you guys couldn't even think about keeping up with me. Redneck backwoods.....don't even try.
Brewing beer is for pussies. Build a still and properly finish what you started, you lazy nob!
As I write this I am polishing off a 20pk on a weeknight. LOL. You have no idea.
Bud Light is what our women drink when they don't want to get too tipsy, and I don't think I've ever heard someone say "this Miller is too strong, I wish I could get my hands on an even weaker beer". But seriously, it sounds like you should take up smoking. Then shoot yourself.
Fuck of you cum belching queer. Yeah im sure you're a real manly man lmao.
I drink my high% home crafted stuff. I seriously doubt anyone here is going to drink a 20pack of this stuff but id be more than happy to let you try because then you'd be dead.
Aw! That's so charming, it takes me back to when I was 13, had my first beer and thought I could drink everyone under the table too! Don't worry, about the time you get your drivers license you'll realize how ridiculous you appear to everyone else and you'll finally mature!
Sounds like you've had a couple of those 20 packs already................
Two Brewers that need to be checked out. Green Flash Brewery and AleSmith Brewery. Two of the finest out of San Diego (the Napa Valley of craft beers). They both make amazing IPA's and variations of them. You won't be disappointed. The "My Bloody Valentine" from Alesmith is incredible!
I'm in SoCal and Green Flash's "West Coast IPA" has been a long time favorite of mine! Ditto for the Firestone "Union Jack" and the hard to find, "Double Jack". And don't forget Widmer's "Deadlift" and "Nelson's Imperial"!
Since you're from SD, you forgot to mention Port Brewing! If you're an IPA man, how could you not have tried their "Hop-15"! And you didn't mention Ballast Point!
And Three Floyds if you are in the Chicago area. Usually multiple top-100s on Ratebeer.com
Arrogant Bastard! but you can get a nice bottle of wine for the same price.
I'll second the arrogant vote
After the micro-brew "revolution" of the 90's it looked like things had fizzled out. After a bit of a shakeout there was still a lot of pretty good product on the shelves but it was sort of pricey and sort of all tasted the same. Plus, the majors began fighting back on price (the 30-pak! the 36-pak!). It looked like things had reached a new equilibrium.
Then, a few years ago, a new wave of funky, strong craft brews started coming out, many of them great and catering to every taste. Even better, very high quality canned beer is now available like never before and thats a really good thing.
I'm sure beer consumption is going down overall but if some beer drinkers are switching to tastier, heavier and stronger brews, their volume consuption is going down even if their alcohol intake is staying the same - so that may explain those charts to some extent.
Also, very drinkable, cheap/mid-price wine is now readilly available in this country - leaps and bounds of better value compared to the situation 20 years ago - so you have to expect a ding to the beer market there.
I am a big fan of canned beer. Makes it easier to pack up and bring out doors. Fishing, camping, tailgating, the beach, etc. Especially when it comes time to carry away the empties. Amstel light and Heineken come in cans.
Here in Raleigh, the local beer scene is booming! A bottle of good IPA is considered hard currency. That's want we need - currency backed by beer! We can all piss our money away and have a good time doing it.
I have a simpler theory. College kids today just might be pussies compared to their past peers.
"College kids today just might be pussies compared to their past peers."
Or maybe we "adults" make them that way by raising the drinking age nationwide to 21. They can vote (yeah, I know), they can die in pointless wars, but they can't have a lousy beer.
Also related, consider that more stringent drunk driving enforcement also correlates w/the decline in beer consumption (along w/the rise in min. drinking age). Call it, the "new prohibition" or "prohibition lite."
Good take, frost. Greenie from me.
Bottom-line is few of us here work in mining, forestry, fishing, a/k/a "manly jobs". Certainly far less of us work in these industries than our grandparents did.
New world order for some; natural evolution of man for others.
Change is inevitable. Don't worry to much about it.
To stay on-topic: beer, values and precious metals endure. Buy physical and you don't have to care about "kids these days".
Im not sure I would call it evolution, that implies an improved species. I dont see physically and psychologically weaker as being more evolved. While change is inevitable, I dont see Homo Urbanicus as having a very high survival rate in the long run- more of a dead end side branch on the evolutionary tree akin to hothouse orchids that only pops up periodically under very mild conditions.
I'm gonna give you a second green, not think too much about what you said, and link to a Lady Gaga video.
http://www.youtube.com/watch?v=qrO4YZeyl0I
I picked a bad post to quit drinking...
Fuckers bought out Goose Island! (And the owners of Goose Island SOLD OUT!)
Funny, this Honker's Ale tastes like East St. Louis smells.
"If it smells like Busch, it's BUSH".
George Bush- DRUNK- http://www.youtube.com/watch?v=tb_dblH3hgw
Poor, dumb Wal Mart shoppers are switching to vodka and cheap pharmaceuticals to get their buzz.
Small, nimble craft brewers make a superior product that the market prefers
Beer, Beer
Beer, Beer, Beer!!
Small beer (business) tastes better than big (corporations)
a very refreshing article
"Beer is proof that God loves us"
Ben Franklin
The reason beer is losing ground is because they can now run hard liquor adds on the teevee again. Most of you do not remember but until 1996 there was a 50 year self imposed ban on liquor advertising.
BOOM, kids love them some ethanol and puttie and liquor is quicker.
Beer and ZeroHedge!
Now we're talking!
I remember when a 12oz bottle of Bud was 35 cents What does a 12 oz bottle of Bud cost now? Maybe that's a clue why consumption is down. Could be Joe Sixpack has higher priorities.
At least beer is cheaper than gasoline. Same with wine.
I went to a friend's new years eve party and picked up some beer. I rarely drink. The prices have gone up. I asked my friend about it as he drinks probably more than he should. More a mixed drinks and martini kind of guy. He said beer has always been relatively expensive compared to booze. Targeted to the working classes who will pay for the overpriced drink. At leats this is what my friend says.
I am pretty surpised how cheap decent wine is. You can go into CVS and they have a decent bottle of wine for $3.99. These are the slighly larger bottles. Lots of great wines from everywhere including Chile, Australia. I rarely partake myself.