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Sunday, April 26, 2015

Ruminations from Paradise

It's been a tough week for me, suffering through some blustery days on Kauai, which is the oldest and western-most of the major Hawaiian islands, if you didn't know. I've been here many times and each trip has its own persona. This time it's unsettled weather.

Being away from Portland has its advantages, and not just when it comes to the weather...which is far better here even though we've seen more rain, wind and gray than usual. Being removed from Portland's beer culture is a bit of a shock, but also instructive.

As I've documented on past trips, there are two craft breweries on Kauai and they both produce decent beer. Beyond that, you find Kona and Maui beers in bars and stores. Some of the Kona brands are unknown on the mainland, but mostly we're talking about standards like Fire Rock Pale Ale, Big Wave Golden Ale, Longboard Lager, etc.

I was thinking about beating up the Kauai beer scene, which is easy to do when you compare it to Portland or almost anywhere in Oregon. But that's way too easy. And, anyway, I've talked about Kauai's beer desert before. Thankfully, I got some help from back home, in the form of a feud involving Portland and Salem over beer. Only in Oregon.

The skirmish started when Willamette Week's Martin Cizmar toured Salem breweries and proceeded to beat up a bunch of their beers in a review. I consider Martin to be a friend, but I have no skin in his reviews. Sometimes we agree on beers and breweries, sometimes not.

I suspect Salem already had a bit of an inferiority complex, being so near Portland. So I wasn't surprised to see someone take exception to Cizmar's comments. That someone is Victor Panichkul, who writes about beer, wine and food for the Statesman Journal. Panichkul delivered a rebuttal which mostly emphasized the quainter aspects of living in Salem. And Cizmar's incompetence.

That wasn't the end of it. News of the feud was picked up by OPB and subsequently by NPR. Perfect. There were some spirited comments on social media, partisans from each side blasting the knowledge and integrity of the other. You can't make this stuff up.

Look, I have no opinion on Salem's breweries or beers. Most of the breweries I know only vaguely. Until I experience the beers personally, I won't take a position. But I do know it's the right and responsibility of beer writers to critique beers, breweries, etc.

In actual fact, there isn't close to enough criticism in this industry. I see too many writers and bloggers pandering to breweries and festival organizers hoping to keep the free beer and event passes flowing. It shouldn't work that way, but ethics and beer writing often don't mesh.

So go ahead and bash Cizmar's putdown of Salem's breweries. Given some of the snide comments in the piece, maybe he deserves it. I'm not defending his comments or opinions. But he has a responsibility to report what he thinks, even if you or I don't agree.

Those of us who cover the beer scene ought to be reporting the bad, as well as the good we experience. Otherwise, our stuff is just so much promotional hooey not worth writing. And we aren't serving the people who are out there looking for information.

Home soon, Portland. The Labs are waiting.

Sunday, April 19, 2015

Dodging Dollars at the Craft Brewers Conference

Getting a bead on what transpired during the just-concluded Craft Brewers Conference in Portland is a tough assignment. That's what happens when you're part of a week long drunk fest that includes seminars and speeches. Hey, that vaguely reminds me of my undergraduate days at Washington State.

For my part, I spent parts of a couple of days at the Convention Center, which was often packed to the gills--despite the fact that many attendees chose to pursue "activities" in other parts of town. My event itinerary included fewer imbibing stops than most, I'm more than sure.

The Brewers Association, the non-profit trade group that represents small and independent brewers, tossed around some impressive factoids. More than 11,000 industry pros attended this shindig, including 600 exhibitors and 175 or so presenters. The Tuesday night Welcome Reception at Memorial Coliseum drew an estimated 8,500 folks. Some may have realized along the way that it was easier to find beer at this conference than it was to find water. But never mind.

The Craft Brewers Conference was last held in Portland in 2001. A lot has morphed in the interim. At the time, there were fewer than 1,500 operating craft breweries in the country. Portland was home to 24 of them. The convention was self-contained in a single downtown hotel, which is hard to imagine considering what has happened.

Fast forward 14 years. There were 3,418 craft breweries at the end of 2014, 58 within the city of Portland. Another 2,000 are in planning nationwide, an elusive number that is forever arching skyward. There's more. Craft beer accounted for nearly $20 billion in sales last year, out of roughly $110 billion in total beer sales. Staggering numbers.

It was impressive to hear Brewers Association royalty talk about the health of the industry and its future prospects. Charlie Papazian, president of the organization, talked about the importance of integrity and staying true to who you are. Gary Fish, founder of Deschutes Brewing and chair of the BA Board of Directors, reviewed some of the industry's current legislative efforts and challenges.

The presentations and educational seminars were nicely done and full of positive vibe. Out on the trade show floor, there was another not-so-subtle vibe. I attended several large medical trade shows in my former life. There were a lot of high rollers at those shows because healthcare is big business. I got the same kind of feeling at CBC...the smell of money was everywhere.

I don't know what I expected. Not exactly this. Exhibitors were hawking all manner of things, but what jumped out at me was the high-tech brewing and packaging equipment. There were obviously folks showing tanks, kegs, signage, schwag, hops, etc. The high-tech stuff struck a chord with me because it isn't cheap and there was a lot of it.

The booths showing high end stuff weren't vacant by any means. These exhibitors were here because there's business to be had. You would never have seen this kind of thing 10-15 years ago. Keep in mind the equipment didn't exist. There were few prospective customers because craft brewers didn't have access to the cash needed to buy the stuff. Bankers were leery of breweries, which were considered long shots likely to fail.

What changed is craft beer has become a huge growth industry, now perceived as a sound, even wise investment. So you have banks and private equity firms searching for ways to get in the game. And don't forget the ever-present and ominous shadow of Anheuser-Busch. There are oceans of capital available to today's breweries. That will continue to be the case until something changes dramatically.

The unanswered question and elephant in the living room is this: How will all this money affect craft beer? Most craft breweries are small, brewing up to 1,000 barrels a year. They have strong local and regional identities and are passionate about what they do. What's going to happen when money enters the picture and blurs ownership and identity? Some, perhaps many, will say this is simply part of a maturing industry. Maybe. But the emerging scenario is unprecedented in the annals of the industry. So we'll have to wait and see what it brings.

Most of the folks who descended on Portland and drank it nearly dry have skedaddled home. The city is returning to normal, whatever that is. Whether the CBC will return to Portland is an open question. I heard many people saying the city isn't equipped to handle a convention of this size. The availability of hotel rooms near the Convention Center is a huge issue, though not the only one.

A connected source told me the Craft Brewers Conference will return to Portland only if it somehow shrinks in size. That seems pretty implausible at the moment, given the direction and momentum of things. But I suppose you never know.

Sunday, April 12, 2015

Craft Beer Locusts Swarm Portland for CBC '15

In case you've in jail or otherwise indisposed, a swarm of craft beer locusts is descending on Portland for this week's Craft Brewers Conference. The gathering has been held here before, but that was 2001. And a lot has happened in the interim. Once you get past the home demolitions and gentrification, craft beer is arguably the hotting thing going in the city.

Given that reality, this will be one hell of a wild week here. Anyone going anywhere for a beer will be confronted with crowds of beer snobs. Numbers can be kind of nebulous, but sources say we'll have upwards of 15,000 people in town, the majority of them connected to the industry. Gonna be nuts.

Who are these people? Brewers, pub owners, distributors, retailers, scruffy beer geeks. There will also be a crap load of vendors in the convention hall, hawking all sorts of interesting stuff. And don't forget the media folks, probably the worst group of all. Just kidding.

The various media outlets have naturally jumped on the CBC bandwagon with lists of the best events and places to visit. What is it about lists, anyway? Beer geeks seem to love them. If you happen to be following along at home (or on a plane), there are some things you may want to keep in mind as you peruse these lists.

The first thing to know is that this isn't going to be the best week to truly see Portland. Even though we are an event and beer-crazed city, we aren't used to this many events (more than 100, I hear) or equipped to handle this week's flood of bodies. If you really want to experience this city at its best, stop back by when there isn't a giant beer convention in town.

As for the best places, there are some venues that all self-respecting beer fans should visit while on temporary leave here. My own short list includes (in no particular order) Hair of the Dog, The Commons, Cascade Brewing, Belmont Station and the Horse Brass Pub. I don't have any strip clubs on my list, but Brian Yaeger offers some useful assistance with that here.

Finally, there's one thing you definitely want to remember as you go about the business of festing this week. After you've had a few too many and you find yourself enjoying an outing at one of our "finer" establishments, don't forget to claim the company credit card on your way out. It's a small thing.

Looking forward to a fine week.

Tuesday, April 7, 2015

The Problem with 10 Barrel's New Pub is Simple

There are some differing opinions on the question of support for 10 Barrel. They recently opened their Pearl location, which was delayed for many months due to who knows what. Inquiring minds wonder if the new place is worth visiting. It's a valid question.

The rather large elephant in the living room when it comes to 10 Barrel (Elysian, too, if they opened a brewpub in Portland) is that the company was sold, lock, stock and barrel (haha) to Anheuser-Busch last fall. How do you put that out of your mind?

Back up. There was a media preview at the new place a few weeks ago. I was shocked to receive an invitation...shocked because I haven't been kind to AB. And they prefer media types who are kind or, at the very least, sympathetic.

I couldn't make the preview due to a prior commitment. I offered to visit another time, but nothing came of it. Perhaps someone on the PR team realized their mistake. No matter. A visit to sample the beers and see the space would have had no affect on my opinion of the place.

There are those who have been pretty understanding of the 10 Barrel buyout. The uproar over the deal was "childish and immature," they've said. These are craft beer people, by the way. Pretty comical. Some of those same folks are now singing the praises of the new brewpub. Big surprise.

Some of the arguments they're making:

The brewers and the beer are wonderful. I'm sure they are, though I've heard through the grapevine that every beer in development must first be approved by the suits in St Louis. It must be reassuring for the brewers to know their creative moves are being watched and evaluated.

The pub layout and ambiance are terrific. Undoubtedly. That's what happens when you spend a boatload of cash to renovate a building and install a pub and brewery. It's in the Pearl so it had to be fancy. Cost may have been an object prior to the AB buyout, less so in the aftermath. Meh.

10 Barrel is providing jobs to a lot of local folks, making it a virtual local business. Great. You can make the same argument in the case of Walmart, one of the most predatory companies on the planet. A bad actor providing local jobs is still a bad actor.

The problem with 10 Barrel isn't the beer or the pub or the people. The problem is Anheuser-Busch, which is not a benevolent friend of craft beer. Some believe AB is doing great things at 10 Barrel. It hardly matters. Because they are ruthless schemers bent on leveraging their position in any way possible, no matter how unscrupulous.

It's a pretty good bet that 10 Barrel's new pub will be packed and busy much of the time during next week's Craft Brewers Conference. I won't be there. Because any money spent in their pubs or on the brands they own works against the interests of craft beer. It isn't that complicated.

Or did you miss the Super Bowl ad?

Maletis-10 Barrel Update: The franchise rights to 10 Barrel brands have reportedly been transferred from Maletis to AB-owned Western Distributing in Portland and Salem. As you know if you've been following along, this was an area of contention between Maletis and the suits in St Louis. Details of the deal were not released.

Thursday, April 2, 2015

Frustration Over AB Branches Grows in Oregon

As a handful of states act to limit the predatory reach of Anheuser-Busch branch distributors, inaction in Oregon has independent distributors on edge. So much on edge, in fact, that they're looking at alternative ways to make something happen.

You may recall recent legislation in Kentucky and Tennessee. In both cases, branch distributors were outlawed. The Tennessee law does allow brewers to own distributorships under certain conditions. Not so in Kentucky, where AB will be forced to sell the distributors it currently owns. Very unhappy campers.

Anheuser-Busch will naturally challenge these laws in court. As they see it, the legislation addresses a problem that doesn't exist: their underhanded business practices. They will have a fleet of attorneys argue that their Constitutional rights have been violated. Never mind the Three-Tier System and the rights of consumers and retailers.

I've talked about branch distributors in this space before. They're part of AB's effort to leverage its position as it loses market share virtually across the board. How it works is simple. They use predatory, discount pricing and other anti-competitive schemes to keep their products on tap and on shelves.

Here in Oregon, there has been no effort to limit or block the expansion of branch distributors. AB currently operates Western Distributing in Eugene and Portland (formerly Morgan). They're able to do this thanks to a loophole in the law that puts no cap on what a large brewer may self-distribute. So they are free to purchase distributors through which they sell their products.

Efforts to block or restrict branch distributors would normally be mounted by the Oregon Beer and Wine Distributors Association, which traditionally looks after the interests of the state's beer and wine distributors in the legislature. Except the OBWDA hasn't done a thing about branch distributors.

We may fairly wonder why there has been no action. Likely, the OBWDA does not relish a fight with Anheuser-Busch. Regardless, its failure to act has caused a riff. The result is that Maletis Distributing has resigned from the group and will reportedly pursue action on its own. Other frustrated distributors may follow.

Please recall that Maletis is engaged in a dispute with Anheuser-Busch over the franchise rights to 10 Barrel. AB bought 10 Barrel last year and expected an easy transfer of franchise rights. But Maletis demanded a fair price and hasn't gotten it. So they continue to to distribute 10 Barrel products, infuriating the suits at AB. Punitive measures targeting Maletis are in place.

Of course, one of the problems with a story like this is that no one wants to talk. I'm relying on snippets of information culled from industry moles who won't be quoted and proprietary publications that can't be quoted. And there's nothing from the OBWDA because they won't talk to or even acknowledge bloggers. They're above the fray, you know.

But it's worth watching what happens. If Maletis succeeds in forming a splinter group that more fully represents the interests of Oregon's independent distributors, we may see some changes in the way things work here. The OBWDA has been around for a long time, but its antiquated cobweb site and lack of action on branch distributors suggest it needs some sort of makeover.

Frustration can be a dangerous thing.