New Belgium’s Bouckaert honored for innovation

That it takes a lot of craft brewers to make a lot of craft beer was obvious at the 2013 Craft Brewers Conference in Washington, D.C.

The Brewers Association announced that 6,400 brewing professionals attended the conference, most of whom also attended the accompanying trade show, BrewExpo America (pictured below – photo courtesy of the BA). The trade show was twice as big as in San Diego in 2012.

BrewExpo America 2013

BA director Paul Gatza provided a complete overview of industry growth, including the details behind 15% sales growth in 2012. There were a record 409 brewery openings in 2012 (99 brewpubs and 310 microbreweries).

Thus a total of 2,347 craft breweries were operating in 2012, with another 1,254 breweries in planning, As many as 500 may open in 2012. There were also 43 closings last year, and Gatza provided on cautionary note. “It wouldn’t surprise me if the number is 50 next year, or if the number is 150,” he said.

Also during the week:

* Peter Bouckaert of New Belgium Brewing received the Russell Schehrer Award for Innovation in Brewing. Since joining New Belgium in 1996, Bouckeart has overseen the creation of a vast array of beers. New Belgium has more beer aging in wooden vessels than any brewery in the country, resulting in many beers in its “Lips of Faith” series. Its range doesn’t stop there — Ranger IPA is one of the best selling India Pale Ales in the country, the fastest growning style in the US.

* Art Larrance of Cascade Brewing/Raccoon Lodge & Brewpub received the Brewers Association Recognition Award for his innovative and award-winning beers. Larrance has been in the industry since the early 1980s and opened Cascade Brewing in 1998.

* David Katleski, president of the New York State Craft Brewers Guild and owner of the Empire Brewing Co., received the F.X. Matt Award for his efforts to make regulatory reform possible and change legislation. Katleski operates a small brewpub in Syracuse and is constantly working to help the local craft market. This past year, he had five major pieces of reform legislation passed in New York.

* A record 233 small and independent American brewery owners and brewers, representing 215 craft breweries and 46 states, climbed the steps of the United States Capitol. They met with Congressional staff to tell their success stories and discuss legislative issues of concern to the craft brewing industry.

* New Belgium Brewing co-founder and CEO Kim Jordan welcomed attendees as this year’s keynote speaker. Jordan presented the keynote at CBC in New Orleans in 2003, where she called for craft brewers to aspire to reach 10% of all U.S. beer sales. A decade later, Jordan returned to discuss issues ranging from technical brewing considerations to the industry’s collective spirit and future.

* Peter DeFazio (D-OR) was presented the Brewers Association Achievement Award in appreciation of his five years of leadership in the House Small Brewers Caucus. DeFazio was recognized for his evergreen commitment to supporting craft brewers and for his personal passion and enthusiasm for craft beer and homebrewing.

* With increasing numbers of craft brewers prioritizing sustainability issues, the BA officially unveiled three new manuals for craft brewers: BA Water and Wastewater: Treatment/Volume Reduction Manual; BA Solid Waste Reduction Manual; and BA Energy Usage, GHG Reduction, Efficiency and Load Management Manual. Each contains multiple levels of solutions for different size breweries and a toolbox including guidance, checklists and Excel-based tools.


Private suit seeks to block A-B InBev/Modelo merger

An antitrust attorney has filed a private lawsuit on behalf of nine consumers, including six from St. Louis, against Anheuser-Busch InBev (ABI) and Grupo Modelo over their proposed $20.1 billion merger.

The St. Louis Business Journal reports Joseph Alioto filed the suit in federal court in San Francisco, stating the acquisition will substantially lessen competition and/or tend to create a monopoly in the production, distribution and sale of beer in the United States.

Alioto is the attorney who tried to block Belgian brewer InBev’s 2008 acquisition of Anheuser-Busch.

“By combining the largest and the third-largest brewers of beer sold in the United States, the defendant ABI, would have more than 54 percent of the beer market in the United States and sufficient monopoly power to exclude competition and raise prices,” according to the lawsuit.


Brew Hub plans first brewery in Florida

Brew Hub has announced plans for the company’s first brewery in Lakeland, Fla. The Florida brewery will be the first of at least five planned facilities that will offer craft brewers the opportunity to “partner brew” their beers on site.

Partner brewing is designed to allow craft breweries to brew their beer to exact specifications under the supervision of their own brewmaster and to package and distribute from the Brew Hub brewery, additionally making beer available for export to international markets. This allows craft breweries to expand their distribution without the overhead costs of building a new brewery or transporting beer across the country.

The Brew Hub will also offer craft breweries services including sales, marketing, logistics, legal, and government affairs.

The Lakeland brewery will be located in Interstate Commerce Park off the I-4 Corridor and will have an initial brewing capacity of 75,000 barrels, or one million cases, annually. The site’s central location will allow the company to efficiently distribute beer to wholesalers throughout Florida and the Southeast.

Brew Hub brewing operations will be led by chief brewmaster Paul Farnsworth, who will oversee all aspects of design, layout, construction and day-to-day operation of the new brewing, production and warehouse facility in Lakeland. Farnsworth earned a bachelor’s degree and Ph.D. from the University of London and has been instrumental in the startup or operation of over 100 breweries in 10 countries.

Brew Hub was founded by a team of former Anheuser-Busch executives led by Tim Schoen. Schoen, CEO, Jerry Mullane, President and Mark Greenspahn, Vice President of Operations. Brew Hub is supported by financing from The Yucaipa Companies of Los Angeles.

“Brew Hub will allow great craft brewers to grow their businesses by expanding into new markets they otherwise could not reach,” said Tim Schoen, chief executive officer of Brew Hub. “This is the most exciting time in history to be in the beer business. Beer drinkers are constantly looking to discover new beer styles and brands every chance they get, but many of the beers they love aren’t available where they live. We’re planning to change that in the Southeast and across the country.”

Brew Hub plans to open at least four similar facilities over the next five years. Specific markets will be determined based on demand, but the company is considering strategic locations in the Northeast, Mid-Atlantic, Midwest, Texas and West Coast.

“There are so many craft brewers making amazing beer today, and the demand from consumers is almost insatiable,” said Schoen. “But too much demand can also be a problem. Building a brewery is not realistic for many brewers and contract brewing opportunities that exist today are less than ideal. We believe our partner brewing model will allow craft brewers a great opportunity to expand their business and reach new consumers.”

The company will begin building the Lakeland brewery, packaging and cold storage warehouse in April. The site will operate as a central distribution facility for craft brewers beginning in fall 2013. The Lakeland facility will deliver beer to wholesalers throughout Florida and the Southeast and will begin brewing beer in summer 2014.

Brew Hub was founded in 2012 in St. Louis, Missouri by a team of beer industry executives and craft brewing experts led by Tim Schoen. “Where Craft Brewers Go to Grow,” Brew Hub provides full brewing, packaging, distribution and selling services for craft brands that are capacity, geographical, or capital constrained. The company plans to have five breweries located throughout the country that will cater to craft breweries. Each facility will allow craft brewers to partner brew their beers on site.


Homebrewing now legal in Mississippi

Mississippi Gov. Phil Bryant has signed a bill that will effectively legalize homebrewing throughout the state. Mississippi is now the 49th state to permit homebrewing. A Senate version of the bill passed in early February and it was then voted on by the State House of Representatives in March.

“From our founding fathers to our current President, this country has a long and storied tradition of homebrewing,” said Gary Glass, director of the American Homebrewers Association. “We appreciate the support of all of the homebrewers, the dedicated grassroots efforts of Raise Your Pints and the legislators who have worked so diligently to make homebrewing a reality in Mississippi. We are grateful to Senator John Horhn who introduced this bill and to Governor Bryant for his quick action and support.”

The 21st Amendment predominantly leaves regulation of alcohol to the states. Therefore, even though homebrewing is federally legal, it is still up to individual states to legalize homebrewing in state codes. Prior to today’s announcement, Mississippi and Alabama were the only two states that did not allow homebrewing. The AHA will continue working with homebrewers in Alabama to legalize homebrewing.

The hobby of homebrewing has seen exponential growth in recent years. The AHA estimates that more than 1 million Americans brew beer or make wine at home at least once a year. Mississippi is home to an estimated 2,200 homebrewers who may now enjoy brewing without the restrictions of a state-wide ban.


Craft beer sales soar 15%

US Craft Beer Growth[Click to enlarge]

Craft beers sales climbed 15% by volume in 2012, while dollar growth increased 17%, according to figures released by the Brewers Association. The increase amounts to almost 1.8 million more barrels (each of them 31 gallons) of craft beer.

With production at 13,235,917 barrels in 2012, craft brewers reached 6.5% volume of the total U.S. beer market, up from 5.7% the previous year. Additionally, craft dollar share of the total U.S. beer market reached 10.2% in 2012, as retail dollar value from craft brewers was estimated at $10.2 billion, up from $8.7 billion in 2011.

“Beer is a $99 billion industry to which craft brewers are making a significant contribution, with retail sales share hitting double digits for the first time in 2012,” BA director Paul Gatza said.

The number of operating breweries increased 18% in 2012, reaching 2,403. The count includes 409 new brewery openings and 43 closings.

“On average, we are seeing slightly more than one craft brewery per day opening somewhere in the U.S., and we anticipate even more in the coming year. There is clearly a thirst in the marketplace for craft brewed beer, as indicated by the continued growth year after year,” Gatza said. “These small breweries are doing great things for their local communities, the greater community of craft brewers, our food arts culture and the overall economy.”

The BA numbers are preliminary. A more extensive analysis will be released during the Craft Brewers Conference in Washington, D.C. from March 26-29.


US craft beer exports up 72%

US Craft Beer Exports

The American craft beer industry set a new record for exports in 2012. Based on results from a recently completed industry survey, the Brewers Association reports craft beer export volume increased by 72% compared to 2011, with a value estimated at $49.1 million.

Canada remained the industry’s largest export market, with shipments increasing 140% by volume. Significant gains have been made in Ontario and British Columbia, and American craft beers are now gaining distribution in other provinces.

Sweden and the United Kingdom remained the next two largest markets. Though total exports decreased in both countries compared to 2011, the decline was offset by increased shipments to other European markets. In total, Western Europe accounted for 56,204 barrels valued at $14.6 million in 2012, a 5.6 percent increase over 2011.

“The BA is very pleased with the continued growth in exports of American craft beer to markets around the world. Consumers continue to view American craft brewers as leaders in innovation and among the standard bearers for quality. Maintaining that perception is a priority for the craft brewing community,” said Bob Pease, Brewers Association chief operating officer.

The BA supports exports through its Export Development Program which was initiated in 2004 with funds from the United States Department of Agriculture Market Access Program (USDA MAP). The Export Development Program generates exposure for American craft beer through trade shows, festivals, seminars, media outreach and competitions, among other activities.