Craft Brew Cross Currents in DC

By Tony Forder
There were almost as many attendees (13,300) at the Craft Brewers Conference in DC this year as in Philadelphia last year, but somehow the vibe was different. More cross currents, less energy, it seemed, as if the craft brewing industry is reeling from the after effects of a massive growth spurt – less brash, perhaps, less self assured, coming to grip with new realities. The new reality is that after several years of double-digit growth, craft brewing slowed to 6% in 2016. But, as Paul Gatza, director of the conference-sponsoring Brewers Association pointed out, "That's a number that many industries would love to have." And there are some mitigating factors. A slower growth rate is mathematically inevitable as industry volume grows and matures. BA Economist Bart Watson stressed that the BA's numbers reflected only breweries that fit the association's definition of an independent brewer; so there was an attrition factor of some 1.2 million barrels from breweries that were taken over by larger entities in 2016 – chiefly Lagunitas and Ballast Point. Most of the slowdown was in the larger regional craft category. Brewpubs showed a 15% growth and microbreweries (including nanos) were up a whopping 27%. Growth at the lower end, "the long tail of craft brewing," in the words of BA President and CEO Bob Pease, is showing no letup. There were 826 brewery openings in 2016 – probably, as Gatza pointed out, 10 new ones during most attendees length-of-stay in DC. While the number of operating breweries in the US is currently estimated at around 5,500, the Alcohol and Tobacco Tax and Trade Bureau (TTB) reports 7,700 brewery licenses already issued. On the trade show floor, vendors were scratching their heads. Is it slower or just more spread out? Nearly a 1,000 booths vied for attention, in three downstairs halls, and two upstairs, although much of the upstairs was taken up by hospitality suites, a nice stage sponsored by Virginia Brewers, and of course the annual Live Oak Bank Cornhole Tournament. The thirst for knowledge was still quite evident as brewers, staff and wannabees criss-crossed on packed escalators hustling to multi-tracked seminars. Veterans of craft lamenting the old days when everyone knew each other; the new young brewers running in their own packs; Boston Beer's Jim Koch's warning about the dangers of consolidation by Big Beer published in a NY Times Op-Ed the week before echoing in the hallways "we may be witnessing the beginning of the end of the American craft beer revolution." Veteran brewer Dick Cantwell addressed some of these cross currents in his keynote address. He called for unity between the old vanguard of craft beer, the pioneers "who took the early blows, and put a roof on the industry" and the new spontaneous innovators. "Understand that the mainstay is not boring and the new is not crazy," he said. "None can do this alone." He also called out the "Elephant in the room" – quality – but praised the collaboration and conviviality of the industry to which he credited the nature of our product – beer. "When was the last time some friends asked you to get together to share a loaf of bread?" BA President Bob Pease called for a stand against "the old order that wants to put the genie back in the bottle...and limit access to choice." He said the craft brewing industry is built on four foundations blocks: Independence, Authenticity, Community Mindedness and Collaborative Spirit, and he urged members to "adhere to values and resist the temptation to adopt questionable business practices." BA Board Chairman Rob Tod of Allagash Brewing warned of a "tectonic shift" as craft beer has gone mainstream, and urged brewers to "tell their story" especially to their local representatives. "Small and independent does matter – it comes easy to us because it's a labor of love." He praised the "thousands of (brewery) gathering places," where people are "spending time with family, friends and tourists. You can't put a value on that." Cheerleader for the industry Rep. Peter DeFazio (OR) warned that democracy itself is at risk. Noting that support for a graduated barrel tax is now at 193 members in the House, he said, "The last bipartisan thing in Congress is craft us save the country!" The keynote stage was share by explorer, author and leadership expert Alison Levine who drew parallels from her experience climbing the highest peak on every continent to discuss how craft brewers can compete in a challenging and changing environment. Vinnie and Natalie Cilurzo, Co-Owners, Russian River Brewing Co. won the Brewers Association Recognition Award; Will Meyers, Brewmaster, Cambridge Brewing Co. received the Russell Schehrer Award for Innovation in Brewing; and Matthew McLaughlin was presented with the F.X. Matt Defense of the Industry Award, on behalf of the Mississippi Brewers Guild. As always, the public presentations closed with the proclamation. "Craft beer is at an all-time high!" The craft brewing scene certainly seemed to be alive and well in DC as area breweries, bars and restaurants put on an amazing show of liquid hospitality. The 2018 CBC will be held April 30-May 3 in Nashville, TN.

No Comments Yet.

Leave a comment