Home' Brewers Guardian Digital Magazine : May 2014 Contents It might not be as yet as famous as 'one small step
for mankind' but the leadership of America's Brewers
Association has committed to significant changes that
puts their organisation -- and our understanding of
craft beer -- on a significantly different footing.
There's a quiet revolution taking place in America's
understanding of craft beer. For years wedded to a definition
of fermentable material having to come from all-malt
sources, the Brewers Association, the non-profit trade body
that represents the interests of the country's craft brewers, today
welcomes the use of adjuncts.
Craft brewers are now able to make use of what use to be considered
the dubious calling cards of the country's industrial scale brewers,
maize and rice, as well as simple sugars, for example, maple syrup,
honey and Belgian candy sugars, as fermentable sources.
According to Brewers Association director Paul Gatza, this change
comes from a reimaging of what constitutes brewing tradition, from
a global rather than strictly Bavarian Purity Law conception.
"In looking at that idea of all-malt beers being a
definition of traditional, that may have been where
a lot of the craft brewers started by doing all malt
beers but a lot of them are starting to evolve beyond
that. We do see some use of adjunct grains by some
of the more popular craft brewers out there."
The broader definition also means a possible
resolution to a riff between the Brewers Association
and a handful of long-established breweries.
It's possible now that well-known breweries
dating back to the 1800s such as Yuengling and
Minnesota's August Schell will be included in 2014
craft brewing statistics.
Gatza said, "I think it's important for the Association
that we have become more inclusive. August Schell
had been a company that had really criticised
the Brewers Association based on that previous
definition and to be more inclusive of some of the
oldest brewing companies in the country does make
a lot of sense."
The aspirational mission
The current fortunes of craft beer in the United
States are can be easily described as bullish,
buoyant - brilliant in short. Annual double digit
growth in both volume and value is now the norm.
The Brewers Association calculates that for 2013
craft beer volumes grew by 18% to a record 15.6
million barrels. Craft beer value also set a new
record, a 20% jump to $14.3 billion.
On the back of this sustained success, the eye-
catching headline to emerge from this year's Board
of Directors meeting wasn't so much the change
to the definition of craft beer. Rather it was the
Association's inclusion of an aspirational goal, to
have craft beer account for 20% of the American
market by 2020.
As well, the 'traditional being tied to
all-malt' is kind of the Bavarian brewing
tradition of the 1500s where that
originated rather than one of our values
being to steward 10,000 years of brewing
history. We were largely ignoring most of
the world's brewing history by having that
Larry Nelson reports
At the close of 2013 the BA calculated that
craft accounted for 7.8% of US beer volume,
suggesting that annual volume would have to
increase around 14-15% over seven years to
meet this ambitious target.
However, Gatza notes a couple of factors that
impinge on this back-of-envelope calculation.
With the inclusion of Yuengling and other previously
excluded breweries, there's approximately three
million barrels to be added to the 2014 figures in
addition to organic growth from existing members.
There's also context: while craft beer is in growth
with overall beer sales in decline. Mainstream
brands are being battered by competition from
wine, spirits and increasingly cider.
Growth is also being boosted by astonishing
numbers of new entrants. The Brewers Association
keeps track of breweries that are in planning, based
on contacts with people that they think are serious
about the idea.
At the moment the BA calculates that are another
1,800 breweries in planning. Gazta notes that while
it takes several years to get such a business off the
ground, tracking such data indicates a consistent
conversion rate of between 35-40% annually.
It would mean that during 2014 another 600
breweries should be firing up their kettles.
However, Gatza thinks that this is a bullish
projection; he estimates that 400 to 500 new
breweries will open during the year.
At the close of 2013, the Brewers Association
calculated that there were 2,822 breweries in
operation in the United States. Of these 2,768
were deemed to be craft breweries, of which more
than 400 began brewing during the year.
While the conversion rate may vary, in absolute
terms hundreds of breweries are opening every
year on a consistent basis. It raises two questions
-- is there space in the market for so many new
entrants? And with so many neophytes, what
assurances are there that quality of the craft
beer produced can be maintained?
Paul Gatza, director, Brewers Association
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