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Sunday, December 30, 2018

Craft Beer: The Year Behind and Ahead

We're creeping toward the end of the year, which means everyone is putting out a list of the best beer or beers of the year. I'm not really a fan of lists. But let me look back on the year that was and provide some thoughts on the craft beer year ahead.

When I wrote this column a year ago, I suggested the popularity of cans would continue to grow and we'd see even more canned beer hitting shelves. That was a bit obvious, thinking back. It wasn't very hard to see the tsunami of cans forming; it had been doing so for several years.

What's most interesting about the emergence of cans in craft beer is how it happened. It wasn't a top-down movement. Established craft brewers, for the most part, were slow to embrace cans. To a significant extent, they were forced to adopt cans to compete with the smaller breweries who launched and articulated the movement. Some established places have even attempted to make their cans look like they came from a small, local brewery.

Anyway, you see more canned craft beer on store shelves than you did a few years ago. A lot more. There are many Oregon breweries that had no beers in cans until this year. Now they're pushing out a growling number of brands in cans.

I've mentioned the benefits of aluminum cans before. They're less prone to breakage, less costly to ship, protect beer from light, are easier to carry on outings than glass and easy to recycle. But that's not why they're gaining traction. They're being adopted far and wide because cans possess a cool factor that bottles don't.

I'm sure we'll continue to see more canned craft beer in 2019. Smaller and mid-sized breweries will transition most of their beers to cans, whether 12 or 16 ounce. Larger breweries will continue to package in 12 oz bottles, while also transitioning their mainstream stuff to cans. Increasingly, bottles are yesterday's news.

Local Beer and the Big Squeeze
Around this time last year, we had 6,000 or so breweries, mostly smaller and independent, operating in the United States. That was a shocking number, given where we were only 10 years earlier. Within the last couple of months, we passed through 7,000, with a huge number in planning.

As I said a year ago, the explosion in smaller breweries has been a terrific boon for consumers, who now have easy access to local beer. But it has also been a disaster for larger craft breweries, caught between the retail and distribution power of the Anheuser-Busch High End and the artisan creativity of small local breweries and losing market share in dramatic fashion.

The brewery count will almost certainly continue to rise. Why? Because there are still plenty of fools determined to open a brewery regardless of market conditions. Closures ramped up in 2018 (see Ezra's article on local closures here) and that will certainly be a common theme in 2019. There's nowhere to hide in a saturated market.

The reality is simple: production of craft beer has grown faster than the size of the consumer market. That wasn't all that hard to predict a few years ago. Even when craft beer was growing double digits, many knew it wasn't sustainable, that we'd hit the wall at some point. That's essentially what's happened.

For several years, I've tried to imagine what kind of fallout we'd see in a saturated market. Part of the answer is that poorly operated or otherwise compromised places are forced out. We're seeing that now. What about prices? Craft beer prices have risen slowly in recent years. Could we see a price war in which brewers cut prices to capture sales in a flat market? Hmmm.

This is an area in which independent breweries are vulnerable. Anheuser-Busch, which has already created significant turmoil with its High End, could use steep discounting to destabilize things further. They can manufacture those brands cheaply and have a strong enough presence in the retail channel to deal independent brewers a serious blow. Could it happen? We shall see.

Best and Worst
I'm seeing a lot of Beer of the Year lists. To me, there's no such thing. I tasted or drank a number of great beers in 2018. It's hard to pick a favorite or favorites because my taste varies from week to week and month to month. I tend to like lighter beers during the warm days of summer and darker, bigger beers when the weather turns cooler. But I can't identify a favorite.

On that subject, generally, I had hoped the haze craze would moderate or die in 2018. It's not that I hate the style...I'm just tired of the frenzy surrounding it and the $8 cans with ridiculous names and artwork. Of course, the haze lives on. But I sense the frenzy around it has slowed down a bit. I suppose that question will come into clearer focus as we move through the new year.

Brut IPA, some thought, would be a replacement for the hazy. Beer geeks were ready for something new, that's for sure. But the Brut movement bogged down when a lot of the beers turned out to be nothing more than hop-flavored LaCroix. I actually tasted a couple of Brut IPAs I liked. Most, however, were middling or bad. Some fine tuning is needed, I guess.

The event madness that started many years ago showed no signs of slowing down in 2018. In fact, the event circuit seems to have captivated an increasing number of wannabes and nerds who chase special releases, collabos, etc. Their dedication is cult-like. Yeah, I understand why breweries, pubs and taprooms do events. But the cult-like fascination is mystifying.

Somehow related to the trendy and frenetic aspects of the industry is the new approach to craft beer promotion on social media. Selling with sex or the suggestion of sex has been around for centuries. Now it's part of craft beer thanks to (for example) Instagram feeds that feature beer-themed soft porn. I'm not sure where this is headed, but I'm pretty sure it's not a good thing.

There's more I could talk about, but that's enough. It's a decent bet that 2019 will be just as interesting and crazy as 2018. Craft beer and the beer industry in general are an ongoing adventure.

Happy New Year!

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