City Brewery buys Memphis facility

City Brewing Co. in Wisconsin will buy a Memphis bottling plant, update the facility and begin beer production there this summer.

City is buying the Hardy Bottling facility for $30 million and will invest another $11 million, eventually creating 500 new jobs in Memphis, Mayor A. C. Wharton and company officials said. The company said the new jobs are expected to create an average wage of $41,705 per year and include a benefits package.

City Brewing makes and packages beer, primarily under contract, producing tea and energy drinks for large beverage companies. Parke said the company was looking for a third facility because its other locations in the Wisconsin cities of Latrobe and La Crosse are at or near capacity. The Memphis facility will be renamed Blues City Brewery.

The company is receiving a $5.7 million tax break over 15 years.

The plant was built in 1971 and has been owned by various brewing concerns since. A tornado damaged the plant in February 2008. It currently bottles only non-alcoholic beverages.


Bill to cut taxes for small brewers introduced in House

Legislation that would reduces the taxes small brewers pay has now been introduced in both chambers of Congress.

The Senate bill, S. 534, was introduced on March 9 by U.S. Senators John Kerry (D-Mass.) and Mike Crapo (R-Idaho). S. 534 would reduce the small brewer tax rate on the first 60,000 barrels by 50 percent (from $7.00 to $3.50/barrel) and institute a new rate $16 per barrel on beer production above 60,000 barrels up to 2 million barrels. Breweries with an annual production of 6 million barrels or less would qualify for these tax rates.

The Small Brewer Reinvestment and Expanding Workforce Act, H.R. 1236, was introduced by Representatives Jim Gerlach (R-Pa.) and Richard E. Neal (D-Mass.) Tuesday. Like its Senate counterpart, the House’s Small BREW Act would enact a graduated beer excise tax rate of $3.50 and $16.

“With the economy sputtering, Congress must create conditions that allow small businesses to become more competitive, protect existing jobs and create new employment opportunities,” Rep. Gerlach said.

Promoting support for the legislation, Brewers Association president Charlie Papazian said, “The 1,700-plus small American breweries account for about five percent of all the beer enjoyed in the United States and 50 percent of brewery jobs. The bipartisan support the Small BREW Act engenders will help assure a positive impact on agricultural, manufacturing, hospitality and distribution jobs for the future.”


Flying Dog files suit to overturn label ban

Flying Dog Raging Bitch label

Flying Dog Brewery, with the support of the Center for the Defense of Free Enterprise, has filed suit in U.S. District Court to overturn the Michigan Liquor Control Commission’s ban on the sale of a popular beer it calls Raging Bitch. The suit also seeks to recover damages from the loss of Flying Dog sales under the statewide ban.

A press release explains:

The brouhaha began in September 2009, when Flying Dog Brewery applied for a license to sell Raging Bitch, the company’s 20th anniversary commemorative beer, in the state of Michigan. The Michigan Liquor Control Commission barred the sale of Raging Bitch, claiming that the beer’s label — designed by renowned British artist Ralph Steadman — is “detrimental to the public health, safety and welfare.”

Flying Dog Brewery disagrees. “Regrettably, the Michigan Liquor Control Commission and its members have taken it upon themselves to control not merely alcoholic beverages, but speech as well,” said Flying Dog Attorney Alan Gura of Washington, D.C.-based Gura & Possessky, PLLC. “The defendants arbitrarily imposed their personal tastes in banning Raging Bitch, clearly violating Flying Dog’s First Amendment right to free expression.”

Gura and Flying Dog CEO Jim Caruso announced the filing of the case at Crunchy’s, a craft beer pub near the Michigan State University campus in East Lansing.

Caruso called the pending legal action about more than a beer label. “It’s about regulators gradually morphing into self-appointed thought police,” he said. “We believe not only in freedom of speech and artistic expression for both businesses and individuals, but also in the individual’s fundamental right to choose or reject books, art, literature, artisanal craft beer, and other forms of artistic expression based on their personal preferences.”

Flying Dog created Raging Bitch, a Belgian-Style India Pale Ale, to celebrate the brewery’s 20th anniversary in 2010. Steadman’s Raging Bitch label depicts a female dog drawn in the style for which he has been internationally celebrated. Steadman does the label art for all the Flying Dog beers.

Alan Gottlieb, president of the Center for the Defense of Free Enterprise, said that his organization “has joined this important legal case because the issues raised have a profound impact on the right to freely engage in the marketplace.”


Anheuser-Busch acquires Goose Island

Anheuser-Busch has acquired Chicago-based Goose Island Beer Co.

Press releases from Anheuser-Busch and Goose Island include the details:

* Goose Island’s legal name is Fulton Street Brewery. Anheuser-Busch reached an agreement to purchase the majority (58%) equity stake in FSB for $22.5 million. Craft Brewers Alliance (CBA), an independent, publicly traded brewer based in Portland, Ore., that operates Widmer Brothers, Redhook and Kona breweries, owns the remaining 42% of FSB and reached an agreement in principle to sell its stake to Anheuser-Busch for $16.3 million in cash. Anheuser‑Busch holds a minority stake (32.25%) in CBA.

* Goose Island sold approximately 127,000 barrels of beer (a barrel equals 31 gallons) in 2010. A-B will invest an additional $1.3 million in FSB as early as this summer.

* Goose Island founder and president John Hall will remain at chief executive.

* Greg Hall, his son, is stepping down as brewmaster but will work a minimum of three of four days a month for the brewery, advising on beers, branding and strategy. “I can’t really talk about what I’ll be doing for another month or so but it won’t be beer,” Hall said in an interview with TimeOut Chicago.

* Brett Porter will take over as brewmaster, beginning May 1. Before joining Goose Island as head brewer in May 2010, Porter worked from 2005 to 2010 as head brewer at Deschutes Brewery in Oregon.

“Demand for our beers has grown beyond our capacity to serve our wholesale partners, retailers, and beer lovers,” John Hall said for a press release. “This partnership between our extraordinary artisanal brewing team and one of the best brewers in the world in Anheuser-Busch will bring resources to brew more beer here in Chicago to reach more beer drinkers, while continuing our development of new beer styles. This agreement helps us achieve our goals with an ideal partner who helped fuel our growth, appreciates our products and supports their success.”

Anheuser-Busch has distributed Goose Island brands since 2006 as part of an agreement with Widmer Brothers Brewing that provides Goose Island access to the network of wholesalers that distribute A-B beers.

“These critically acclaimed beers are the hometown pride of Chicagoans,” said Dave Peacock, president of Anheuser-Busch. “We are very committed to expanding in the high‑end beer segment, and this deal expands our portfolio of brands with high-quality, regional beers. As we share ideas and bring our different strengths and experiences together, we can accelerate the growth of these brands.”

The two Goose Island brew pubs are not part of the deal, but will continue in operation.


BA honors Talley, McDonald and Kopman

The Brewers Association honored two representatives of Missouri breweries and the first woman to receive its most coveted annual award reserved for brewers during the Craft Brewers Conference in San Francisco.

Jennifer Talley of Squatters Pub Brewery and Salt Lake Brewing Co. won the Russell Schehrer Award for Innovation in Brewing.

“Jennifer has won countless awards at the Great American Beer Festival and World Beer Cup against other beers that are of higher alcohol content in styles where alcohol is a key thread to carry the flavor of the beer,” said John Harris of Full Sail Brewing Co., another Schehrer award winner. “She has all of the character of previous winners of this award — a passion for beer, passion for our industry and passion for expanding her and her fellow brewers’ knowledge.”

The award was given in 1997 to honor Russell Schehrer’s contributions to the brewing industry. Schehrer died in 1996 at 38 years of age and was a founding partner and original head brewer at Colorado’s first brewpub, Wynkoop Brewing Co.

The Brewers Association Recognition Award went to John McDonald of Boulevard Brewing Co. McDonald founded the brewery in 1989 and began hand-delivering Boulevard beer to local restaurants in his own pick-up truck. McDonald’s brewery now employs over 90 people and has a capacity of approximately 600,000 barrels per year.

“John pioneered craft beer in a part of the country that did not have a lot of other active small brewers,” said Rich Doyle of Harpoon Brewery. “He was a missionary of sorts and has built a great brewery, brand and business. He is also a very good guy.”

The F.X. Matt Defense of the Industry Award went to Dan Kopman of St. Louis Brewery, which produces Schlafly Beer. Kopman has worked recently on to promoting legislation that would recalibrate federal excise taxes for small brewers.

“Dan deserves this award for his dedication and leadership on the excise tax bill,” remarked John Pinkerton of Moon River Brewing Co.

The F.X. Matt Award is given in honor of a champion of small brewers, F.X. Matt (1933-2001), president of the F.X. Matt Brewing Co. in Utica, New York from 1980-1989 and chairman from 1989-2001.


Stella Artois introduces ‘chalis’ cans

Stella Artois is rolling out 440ml (14.9-ounce) aluminum cans the first day of April.

The silver can features the silhouette of Stella Artois’ signature chalice glass, and will be sold nationwide in 4- and 10-pack configurations. The 10-pack will be called “Pour le Fridge” (French for “for the fridge”).

This the first time Stella Artois has been available in cans. The brewing company continues to suggest the best way to serve Stella is in its signature chalis, but this makes available for outdoor occasions where glass is not permitted.


Craft beer production up 11% in 2010

Craft Beer Sales Climb 11%

The Brewers Association today announced craft bewers produced 11% more beer in 2010 than 2009, and that retail dollar sales increased 12%, representing a growth of more than 1 million barrels (31 gallons per U.S. barrel).

“Beer lovers increased their appreciation for American craft brewers and their beers in 2010,” BA director Paul Gatza said for a press release. “Craft brewers’ stories resonate with Americans who are choosing small, independent companies making delicious beers in more than 100 different styles.”

The Association also reported a growth in the number of U.S. breweries, with 8% more breweries than the previous year. In 2010, there were 1,759 operating breweries. Craft brewers produced 9,951,956 barrels, up from an adjusted 8,934,446 barrels in 2009.

In 2010, craft brewers represented 4.9% of volume and 7.6% of retail dollars of the total U.S. beer category. The Brewers Association estimates the actual dollar sales figure from craft brewers in 2010 was $7.6 billion, up from $7 billion in 2009.

As an interesting side note, Gatza said: “We also found that three percent of craft brewer barrels, by volume, are distributed in cans, confirming a growing trend.”

A more extensive analysis will be released on March 24 during the Craft Brewers Conference in San Francisco. The Association’s full 2010 industry analysis, which shows regional trends and sales by individual brewery, will be published in the May/June 2011 issue of The New Brewer.


Deschutes Brewery boosts capacity

Deschutes Brewery this week announced that it has finalized plans to expand its brewery headquarters in Bend, Oregon. Deschutes will add five fermentation tanks to keep up with growing demand. The brewery will also remodel its tasting rooms and gift shop.

“Demand is rising in our local market and among our loyal fans in the states where we sell our beer,” said Gary Fish, president and founder of Deschutes Brewery. “This expansion is an investment in our future to make sure that we are ready for the increased demand.”

The will create a new building to house the fermentation tanks, a new two-story building that will hold future processing equipment, an electrical control room and new restrooms and showers for the staff. The expansion will allow Deschutes to produce an additional 105,000 barrels per year, along with enhanced processes to continue ensuring beer quality and consistency. This will be the first phase in a two-phase expansion. The second phase will take place in several years and include five more fermentation tanks.

Water and energy efficiencies are built in to the new design, including the installation of a continuous use cleaning system and the addition of a water re-use tank which will save thousands of gallons of water and energy per year. Additional sustainability features include a heated warm rinse tank, which will save hot water and steam for tempering tanks between cycles. The brewery will continue with designs to capture CO2 from the fermenting process and decrease waste to the city sewer system.

Construction on the space is slated to begin mid-May 2011.


Alaskan beers headed to Minnesota

Alaskan Brewing will begin selling its beers in Minnesota in May. Original Gravity, a network of locally-owned craft distributors, to make the beer available in the Twin Cities and surrounding suburbs.

“We have had a lot of interest in Alaskan Brewing and so have our customers,” Original Gravity’s Hans “Hanszee” Lofgren said. “We are extremely happy to be bringing their award-winning beers to market.”

This is the first new market entrance for Alaskan since entering Colorado in mid 2008. With the addition of Minnesota, Alaskan beer will be available in 11 states.

“Alaskans and Minnesotan’s have a lot in common – cold winters, a love of the outdoors and a growing appreciation for quality craft beer,” said Alaskan Brewing co-Founder Marcy Larson. “We’ve been getting letters, calls and emails from thirsty Minnesotans for years – we’re thrilled to finally be answering the call.”


Redhook gussies up for 30th birthday

Red ESB through the years

Redhook Brewery is celebrating its 30th birthday by unveiling a new look, including bottles, labels, bottle caps and packaging.

A press release states the new look is all part of Redhook’s effort to get back to its roots. “There seems to be a movement within the craft beer community where a lot of breweries are trying to ‘out craft’ each other,” said Robert Rentsch, brand manager of Redhook Brewery. “Redhook isn’t about that. Of course we’re brewing great beer, but we’re just as interested in having a great time. We think our new look reflects our personality well.”

Paul Shipman and Gordon Bowker (also co-founder of Starbucks) started Redhook in 1981 in a converted transmission shop in Seattle’s Ballard neighborhood. Of course the brewery — now part of the Portland-based Craft Beer Alliance — grew into a much larger operation, which plants in Woodinville, Wash., and Portsmouth, N.H.

The new look includes:

* Packaging/Labels: Every beer style is identified by a unique color scheme and Redhook’s has added “beer-o-meter” to guide consumers looking for particular flavors.

* Bottle/Bottle Caps: To go back to basics, Redhook created a no-frills bottle, while the bottle caps all depict iconic images and phrases of Redhook’s colorful 30-year history.


Wynkoop, Breckenridge finalize joint venture

Wynkoop Holding and Breckenridge Holding have finalized the details for their previously announced joint venture.

Wynkoop Holdings is the parent company of Wynkoop Brewing Company and seven Colorado restaurants and brewpubs. Breckenridge Holding is owner and operator of Breckenridge Brewery and four Colorado brewpubs and taphouses. Many changes are already under way:

* Wynkoop head brewer Andy Brown has been working out on Breckenridge’s 50-barrel system, in preparation for brewing there later this month. The canned and kegged versions of Wynkoop’s Rail Yard Ale and Silverback Pale Ale will be brewed and canned at the Breckenridge facility in Denver.

* Soon both Breckenridge and Wynkoop microcanned beers will be packaged on new equipment. The collective has made its first joint purchase, a prototype automatic canning machine that will quadruple the breweries’ canning speeds. It will allow both breweries to add new canned beers this summer, including Breckenridge’s SummerBright Ale this summer.

* Wynkoop and Breckenridge staffers have also begun work on a collaborative beer that will reach the Denver area’s best beer establishments in May. The draft-only beer is a Belgian-style strong ale unlike any beer the two have made in the past.

* Breckenridge will open Amato’s Ale House, a beer-focused restaurant feature 40 beers, taking over a building that is a Denver institution. Amato, which sells concrete garden décor like fountains, statues, birdbaths and planters, has been in the same location since 1947. The family-owned business is moving up the street one block. “We want to keep the north Denver theme,” said Ron Piscitelli, director of restaurant operations for Breckenridge. Breckenridge will decorate the Ale House with fountains from Amato.


Samuel Adams shipments up 12% in 2010

Boston Beer Co., brewer of the Samuel Adams beers, reported higher sales for the fourth quarter and all of 2010, although its stock was punished — the stock prices dropped 11% in after hours trading Tuesday — because it did not meet Wall Street’s expectations. Shares of Boston Beer (SAM) had more than doubled since the beginning of 2010.

Highlights of its report were:

* Depletions growth of 12% for the quarter and 11.5% for the year.
* Core shipments increase of 7% for the quarter and 12% for the year.
* Core gross margin improvement to 55% for 2010 from 52% in the prior year.
* Increase in the company’s investment behind its brands for 2010 of $14.1 million.
* Earnings per diluted share of $0.87 for the fourth quarter and $3.52 for the year.

Given that Boston Beer accounts for about one in five craft beers sold (according to the Brewers Association definition) this is one more sign that when the final totals are in for 2010 overall craft beer sales will likely be up about 11% to 12%.

Boston Beer founder Jim Koch, summarized the success for a press release: “We achieved depletions growth of 12% in the fourth quarter, and total depletions for the year grew 11.5% to 30.9 million case equivalents. This record total depletions for the fourth quarter and full year is attributable to our strong sales execution and continued support from our wholesalers and retailers. While we continue to see expanded distribution of domestic specialty brands and local craft brands, which is increasing competition in the category, we are happy with the health of our brand portfolio. After 26 years, we continue to grow our flagship beer, Samuel Adams Boston Lager, even as we continue to innovate and develop new beer styles, such as Samuel Adams Noble Pils, the Barrel Room Collection and Infinium.”

He announced the company will expand it Freshest Beer Program, tested last year with five wholesales, adding ten wholesalers in the first quarter. “This program substantially reduces both the time and the temperature our beer experiences at wholesaler warehouses before reaching the market,” he sad. “This reduction in time and temperature is not only great for our beer; we believe it will also be financially and organizationally beneficial to our wholesalers and in the long term good for our business.”