Here’s yet another look at the changing landscape of brewery ownerships, this time from Vinepair, and while they primarily write about wine, they also must tacitly accept the well-trodden wisdom that “it takes a lot of beer to make great wine,” since they do occasionally tackle beer. Last week, the posted their “Map: The Companies Who Actually Make Your Beer.” It’s restricted to ten of the largest companies who own multiple breweries and, to their credit, it’s been updated four times so far, meaning they’re doing their best to get it right, which given its complexity, not to mention who often it’s changing, is no easy task.
The Wall Street Journal had a piece on the beer business entitled Beer Giants Cultivate Their Crafty Side which I can’t read in its entirety because I don’t have a subscription, but it did include a chart showing the current state of affairs in the beer industry.
Shifting Suds. “Independent brewers are selling more beer,” but given this comes from the Wall Street Journal (which is all about BIG business) they can’t help but add “but their shipments remain small compared with the big beer brands.”
What the Wall Street Journal forgets to mention is that Anheuser-Busch was founded in 1852 and didn’t hit 1 million annual barrels until 1901, when they were 49 years old. Sierra Nevada took only 35 years (or less) to reach 1 million, and Boston Beer needed even less time, reaching their first million barrels 1996, meaning it took Samuel Adams 12 years.
As the year’s winding down, I noticed this article from Booze News from last week entitled America’s Fastest Growing Beer Brands. While the article itself offered few insights, I noticed a graphic depicting which beer companies owned which brands. The graphic was taken from a Gizmodo article that ran a little over a year ago about Who Actually Owns Your Favorite Beers. I added one or two to ABI’s stable of brands, but otherwise a year on it’s still fairly accurate. If there’s any that need to be added, or changed, let me know in the comments and I’ll see what I can do.
For the last several years, sales of some of the major beer brands have been slipping, and not just the sub-premiums or secondary packages but even once mighty flagships. 24/7 Wall Street has a new list of some of these brands, characterized as Beers Americans No Longer Drink. Using data from Beer Marketer’s Insights, here are seven brands that have lost significant sales, at least 20%, between 2013 and 2008. The negative number following the name is how much sales are down in that six-year period.
- Miller High Life -21.2%
- Budweiser -27.6%
- Milwaukee’s Best Light -40.6%
- Milwaukee’s Best -57.0%
- Miller Genuine Draft -58.3%
- Budweiser Select -61.1%
Some additional analysis and reasons for the decline, according to 24/7 Wall St:
Another key factor in the weakening sales has been price dynamics. “Beer prices were increased more aggressively over the last five years than wine and spirits,” Shepard said. Many people in the industry believe that, as a result, some customers replaced buying beer with the now relatively less expensive wines and spirits, he explained.
Several other products were also gaining at the expense of big brand-name beers, Shepard noted. While some customers have been moving to wine and spirits, others were switching to imported beer, particularly Mexican imports. Indeed, in the five years through 2013, shipments of Mexican brands Dos Equis and Modelo Especial more-than doubled. Similarly, he added, “Some [drinkers] are moving to craft [beer]. Clearly, there’s been a trade-up in the industry.”
Craft beers have largely bucked the overall downtrend in beer sales. From 2008 to 2013, shipments of craft beer rose by 80.1% to a total of more than 16 million barrels, or 7.6% of the U.S. beer market. While the craft beer category now outsells Budweiser, it remains a relatively niche market. For comparison, the nation’s top-selling brand, Bud Light, shipped 38 million barrels in 2013, accounting for 18% of all beer shipped.
This caught me by surprise. Anheuser-Busch InBev announced today that it is buying 10 Barrel Brewing, the award-winning brewpub located in Bend, Oregon. 10 Barrel is the brewery that Tonya Cornett, formerly of Bend Brewing, moved to a couple of years ago.
From the press release:
“For the past eight years, we’ve been brewing beer, drinking beer and having fun doing it.” said co-founder Jeremy Cox, who will continue to lead 10 Barrel along with his partners, co-founder and brother Chris Cox, and Garrett Wales. “We are excited to stay focused on brewing cool beers, get our beers in more hands, and make the most of the operational and distribution expertise of Anheuser-Busch,” said Cox.
10 Barrel expects to sell approximately 40,000 barrels of beer in 2014. Apocalypse IPA, the brewer’s most popular beer, accounts for nearly half of the company’s total volume.
“10 Barrel, its brewers, and their high-quality beers are an exciting addition to our high-end portfolio,” said Andy Goeler, CEO, Craft, Anheuser-Busch. “The brewery is a major contender in the Northwest, an area with a large number of craft breweries. We see tremendous value in the brewery’s unique offerings and differentiated style, which 10 Barrel fans know and love.”
In addition to the Bend brewery, the acquisition will include the company’s existing brewpubs in Bend and Boise, Idaho; and a Portland brewpub scheduled to open in early 2015.
The deal should close by the end of the year, though the terms or price have not been disclosed.
The founders of 10 Barrel also posted a short video explaining their decision and, perhaps more importantly, asking people to give them the benefit of the doubt before rushing to judgment and “let the beer do the talking.”
While to a certain extent it’s easy to understand the reaction of the big brewers, it’s still just sad. It’s the equivalent of negotiating with terrorists, in this case the food terrorists, so to speak. If you haven’t figured out what I’m talking about yet, it’s the so-called Food Babe, and her weird crusade against beer, among many other foodstuffs. She’s the modern version of yellow journalism, all sensationalism and almost no substance. It’s described as “a type of journalism that presents little or no legitimate well-researched news and instead uses eye-catching headlines to sell more newspapers. Techniques may include exaggerations of news events, scandal-mongering, or sensationalism.”
Her first salvo was last year when she sensationally claimed to expose The Shocking Ingredients in Beer. Almost every one was as un-shocking as it gets, especially if you understand the brewing process. But that’s the new yellow journalism, and unfortunately you see it all over the internet. A provocative headline to grab page views, link bait or something just overly sensational is all you need. It’s happened so many times since I’ve been writing online that I’ve lost count. And it works. The beer community rushes in to correct egregious mistakes, faulty reasoning, uninformed opinion while the hit count spikes, advertisers smile and websites raise their advertising rates. It rarely matters that what’s written is often wrong, sometimes so utterly wrong that it should be embarrassing for not only the author, but the publication, too. And yet curiously, it’s not. And for me, that’s why it’s yellow journalism. It’s not intended to be factual, or well-researched or reasoned. It’s sole purpose is to get eyeballs on the page. And facts apparently are boring. The truth is somnambulistic. Controversy, even the manufactured kind, is what brings the traffic.
I don’t need to rehash all that was wrong with the original missive by the Food Babe, The Shocking Ingredients in Beer. Plenty of people dissected it at the time, though none better than Ambitious Brew author Maureen Ogle, who enlisted the help of several respected brewers in her lengthy, comprehensive denunciation What’s In YOUR Beer? Or, The Dangers of Dumbassery, which she later summarized in All About Beer Magazine as Don’t Be A Knee-Jerk, Research the Facts. As Ogle notes, the Food Babe started her “research” with a “baseline list of ‘legal’ additives allowed in beer from the book ‘Chemicals Additives in Beer’ by the Center of Science and Public Interest.” Despite its name, the CSPI is a prohibitionist organization that rarely has anything to do with actual science. It’s one of the most egregiously dishonest of the bunch, in my opinion, an opinion assembled from following them for many years. They’re hardly a good place to begin an honest attempt to look at the ingredients in beer. Plus she begins by stating she’s not even a beer drinker, but prefers wine, even though many of the process chemicals she accuses beer of being composed of are also used in making wine.
A close second, there was also Thomas Cizauskas’ take in Beer Wars: The Calumny of The Food Babe. But others, before and since, have noted that Vani Hari (the Food Babe’s given name) has zero credentials in food sciences, or any other science, apparently. See, for example the RationalWiki or Joe Schwarcz: The Food Babe is anything but an expert on GMOs, writing in the Montreal Gazette. There’s no shortage of people writing about what she’s saying — pro and con — and that, of course, is the point. She’s so out there that people can’t help it; the Ann Coulter of food punditry. Despite so many people crying foul, it’s had no effect whatsoever, which is exactly what you’d expect if truth was never really the goal.
So yesterday, she doubled down and penned an open letter and petition: Anheuser-Busch and Miller Coors: Tell Us What’s In Your Beer! This, despite the fact that beer is hardly a mystery, and its ingredients and processes are not only well know, but readily available to anyone who wants to learn about them. But learning about what’s really in beer has apparently no interest to Hari whatsoever. There’s no angle she can sell in that. But ignorance is indeed blissful, and over 40,000 possibly well-meaning but similarly misguided people signed her petition, despite not really understanding the current law regarding alcohol is different for most other food products.
And she even contradicts herself with the basic premise. In her ridiculous graphic, she says that we know what’s in Coca-Cola and Windex, but not beer (even though she claimed to unearth what’s in beer last year) even though anyone paying attention already knows what’s in beer, how it’s made and the process chemicals that are not in the finished product. It’s hardly the #MysteryBeer she claims it to be. That’s a joke, a lie and a very effective way to drum up visitors. There’s no mystery to end, and she knows it. But it’s a fabulous way to get more attention for herself. And boy is it working.
But worst of all, earlier today ABI quickly caved. As a public company, I presume they concluded that the publicity was bad for their image, despite the absurdity of it. Of course, if she’d done even a modicum of actual research, she would have known that since at least 2012, ABI created a website (probably in response to the watering down claims) called tapintoyourbeer.com , which lists for every product they make, the ABV, fat, energy, carbohydrates and proteins. Now they’ve begun listing the primary ingredients for some of their products. For example, for Budweiser they list: “Water, Barley Malt, Rice, Yeast, Hops (ingredient listing is consistent with the FD&C Act).” In their official statement, they say they’ll be expanding that information with additional beer ingredients.
We provide significant information about our beer and their nutritional content through both our consumer hotline (1-800-DIAL-BUD) and our global consumer-information website www.tapintoyourbeer.com, which we have expanded over the years. This exceeds what is required of alcohol producers and is beyond what many other beer, wine and hard liquor producers provide. However, as American consumer needs evolve, we want to meet their expectations. Therefore, we are working to list our beer ingredients on our website, just as you would see for other food and non-alcohol beverage producers. We are beginning immediately, having incorporated this information earlier today on www.tapintoyourbeer.com for our flagship brands, Budweiser and Bud Light, and will be listing this for our other brands in the coming days.
To which, the Food Babe is claiming victory for her and her “Food Babe Army,” which is apparently what she calls her followers or fans, and states that they have “change[d] the policies of a multi-billion dollar company overnight.” But she’s not done, not until every brewery falls in line with her demands. She’s now posted a new graphic crowing about ABI caving in to her demands and asks what MillerCoors is hiding now that they’re “drinking in the dark,” whatever that means.
At MillerCoors, we put quality and safety above all else. Our beers are regulated by the TTB and every one of our products meets all federal and state regulatory requirements.
We’re proud of the care that goes into the production of all of our beers and have been brewing great-tasting beers with the highest quality ingredients for more than 440 combined years.
From the purity of the water we use to the highest-quality hops and malted barley, our brewmasters go to great lengths to ensure the quality and consistency of our beers.
We also value transparency and are happy to comply with the request for additional information. Earlier this year, we led all alcohol companies by voluntarily placing a nutritional label on our Miller64 brand and we will be putting more ingredient information online in the days ahead.
We will be including the ingredient list starting with our most popular brands, representing the overwhelming majority of our brand volume:
Coors Light, Miller Lite, Blue Moon Belgian White, Coors Banquet, Miller Genuine Draft, Miller High Life, Keystone Light and Miller Fortune.
Coors Light: Water, barley malt, corn, yeast and hops
Miller Lite: Water, barley malt, corn, yeast and hops
Miller High Life: Water, barley malt, corn, yeast and hops
Keystone Light: Water, barley malt, corn, yeast and hops
Blue Moon Belgian White: Water, barley malt, wheat, oats, yeast, hops, orange peel and coriander
Coors Banquet: Water, barley malt, corn, yeast and hops
Miller Genuine Draft: Water, barley malt, corn, yeast and hops
Miller Fortune: Water, barley malt, corn, yeast and hops
Maybe she didn’t have time to update her graphics again. Certainly she knows Miller Coors posted these, because she’s posted on their Facebook page, with this:
I have an email from you that says you use “corn syrup” and it’s a main ingredient in your beer – also – you said via email that bluemoon and banquet both have corn syrup. Where’s the full list of ingredients?
They replied, trying to explain that “the corn we use is a liquid corn brewing adjunct, but it is not high fructose corn syrup.” The ignorance about brewing displayed in the comments, presumably by her Food Babe Army, is as alarming as it is remarkable.
The problem is with the first expose, where the Food Babe brought up many different chemicals and items which are used in the brewing process but are not ingredients. Some are used to cool the beer through the process, some for cleaning, and some for other purposes that don’t end up in the beer you drink, some of which never touch the beer at all. For just one example, she claimed glycol was in beer. But that’s merely a coolant used to chill beer in the brewing process. It never touches the beer … ever. If it did, it would ruin the beer. But it’s still there in her list, displaying either a comic ignorance or a malicious intent to mislead. But that’s the irony. She’s claiming to be holding brewers’ feet to the fire to be truthful and transparent, while she herself is being completely dishonest. If her intent was honest, by now she would have modified her earlier attack to reflect the reality she would have, or should have, learned in the year since she first made her absurd claims about what’s in beer. If she was being honest, she’d admit some, if not all, of what she’d claimed was in beer, really wasn’t, for the simple fact that it’s not. That she appears to have learned nothing in the year since she first made her sensationalist claims, and stands by every one of her absurd statements, tells us everything we need to know about her veracity and her real intentions.
Most brewers I know don’t have a problem rattling off their beers’ ingredients nor would they probably mind listing them on the bottle or can, if they were required to do so. It’s not a conspiracy that they don’t have to currently. They do have to list them when they submit each beer for approval to the TTB, who regulate beer and other alcohol at the federal level. There’s already been discussions about listing nutritional information and/or alcohol and servings information. So nobody’s getting away with anything, or trying to poison you with chemicals, as the Food Babe suggests. That’s just bullshit. Whether or not you like the beers made by the big brewers, they’re very well made and modern breweries are industrial and technological marvels. For the most part, they’ve perfected the science of brewing. It’s too bad the fizzy yellow color of their beer is now the same color of the journalism attacking the beer industry.
UPDATE (6.13): To further prove my point, throughout the day, several people have commented that the Food Babe does not allow any dissenting opinions on her Facebook page, removing and banning anything challenging her point of view. And I’m not talking about anything insulting or harassing, I’m talking about science that refutes her. For example, the gentleman who writes the Facebook page Science Corner told me he was “blocked when I pointed out her inconsistencies and lack of fact checking. As a scientist I referenced my comments with actual facts taken from peer reviewed scientific journals.” Nothing says “honesty” like not allowing any debate. To makes matters worse, apparently her minions are now attacking me personally. Not my arguments, mind you, just my character. For example, one Food Babe Army soldier asked me if I was “bought & sold by Monsanto” or speculated that perhaps “Most of [my] investments [are] in big AG.” Hilarious, they really know me so well. I’m not exactly sure why dissent is so assiduously forbidden, if — as her followers insist — she’s just trying to get at the truth. As one commenter claims, “she’s trying to help WE THE PEOPLE make better decisions so we don’t become sick.” Apparently her plan to help these people with their decision-making will be accomplished by not allowing honest debate. Yet I’m the one who is “the YELLOW JOURNALIST,” as one of her wingnuts spat at me. It’s simply amazing.
UPDATE 2 (6.17): Several other rants about how dishonest Hari is being with her anti-beer campaign are worth taking a look at. First, Maureen Ogle wrote some new observations in Beware the Dangers of [Profit-Driven] Dumbassery. A couple more include Trevor Butterworth writing in Forbes, Quackmail: Why You Shouldn’t Fall For The Internet’s Newest Fool, The Food Babe, and Vani Hari (a.k.a. The Food Babe): The Jenny McCarthy of Food by David Gorski, writing in Science-Based Medicine. We’re all continuing to get trolled by the Food Babe Army, which is almost funny. One interesting troll tried to find fault with my take on glycol as a coolant, but mistook propylene glycol for another similar-sounding food safe compound used in salad dressing, among other things. For him it was a “gotcha” moment and (despite being wrong) he then declared (again) that I was “the yellow journalist.” This brings up two points in my mind. First, what the hell is wrong with these people? Why are they even using the term “the yellow journalist,” as if that’s a thing? They clearly don’t understand what yellow journalism is. I helpfully included a link to an overview of yellow journalism so that anyone unfamiliar with the more than 100-year-old term (almost everybody, one presumes) could see what I was talking about. The second point, and the more troubling of the two, is the idea that if Vani’s Army found one mistake in what I’ve written then that invalidates my entire argument and means that I’m the one engaging in yellow journalism. It’s a curious argument. They’re holding Vani’s critics to a standard of perfection that they’re not willing to impose on her. As far as I can tell, this has become about emotions and belief, and the facts no longer seem to matter, if indeed they ever did. That’s a scary prospect, but how else to explain why so many people seem to believe what she’s saying so uncritically and continue to do so when faced with numerous refutations disproving what she’s saying, and which are actually backed up with real science or expertise or experience. And speaking of being uncritical, it’s quite remarkable how many mainstream media outlets have given Hari a forum, and are passing on her misinformation without ever doing any fact-checking or maybe getting a second or contrary opinion. So much for being fair and balanced. But again it comes down to sensationalism, and the fact that controversy is what people what to see, the truth be damned.
UPDATE (7.14): Maureen Ogle today mentioned a new piece about the Food Babe in the Charlotte Observer, ostensibly the Food Babe’s home paper, Charlotte’s Food Babe has lots of fans – and some critics. Unsurprisingly, it’s mostly a fluff piece although at least it does address some of the criticisms leveled at Vani Hari. But it lets her get away with more than a few howlers, such as “Hari says she is simply trying to help people understand what’s in their food and hold companies accountable. She says she has researched her critics and that they attack anyone who opposes alternative nutrition.” Really, she’s “researched her critics?” I’d feel a lot better if she’d research their arguments and the science behind her original absurd claims.
Interestingly, the article mentions that she, and her husband, left lucrative “six-figure incomes” to run the website full-time, one that’s “packed with advertising and product endorsements. You can even buy an eating-plan subscription for $17.99 a month.” As someone who makes zero from writing this blog (and that’s on purpose I should add), I’d say you have to sell an awful lot of snake oil to make that work. Of course, the “babe” in food babe all but guarantees that she’ll get television time since we love people who are telegenic over substance so you’ll not be surprised in the least that she also has a “William Morris Endeavor agent to handle her TV appearances.” Frighteningly, a publisher is even putting out a book, “The Food Babe Way,” so that doesn’t sound like a cult or anything scary.
As to where she makes her money, something her “Army” loves to level at her critics (for example, commenters asked if I was being paid by Monsanto, oddly enough), it’s been revealed that she was a paid consultant to Chick-fil-A, but also claimed victory over the fast food chain when they announced they’d “use chicken that was free of antibiotics within five years,” posting “We Did It Again!” According to the Charlotte Observer, “Hari has confirmed that she was paid by Chick-fil-A for her work as a consultant on their ingredients, a fact she appears to have not mentioned on her website.” Yet none of her followers apparently have a problem with or see any contradiction in that.
Then there’s this headline: “Debate is her sport.” That’s almost funny, if it wasn’t so crucial to what’s wrong with someone like like Hari. She may claim to love debate, but she assiduously avoids it by banning anyone who questions her “findings,” even politely. The comments section of any piece written about her is rife with people telling tales of being banned, even this post.
Under “Science or silliness?,” the Observer brings up the nonsense about glycol, thusly:
Her claim about “an ingredient found in antifreeze” being added to beer also draws criticism. Actually, the ingredient used is propylene glycol alginate, a kelp derivative used to stabilize head foam, not propylene glycol, a coolant. She later clarified this on her website.
While she sort of updated information about her original claim, under Big Update: The Truth That Beer Companies Have Not Made Public Yet, under the subheading “‘Propylene Glycol Alginate’ is added to beer as a foam stabilizer,” she continues to mistake Propylene Glycol Alginate, or PGA, for “Propylene Glycol” that’s used in antifreeze, even though they’re two completely different animals. And in the original post, The Shocking Ingredients of Beer, still lists “Propylene Glycol (an ingredient found in anti-freeze)” exactly the same way as when it was first posted last fall. So the that misinformation is still being disseminated, despite her claim to have “clarified” it. Considering she keeps talking about “transparency,” why not update the original post? Well, the real reason is she’s still not even close to understanding what she’s talking about, and as far as I can tell she no intention of even trying to.
The Atlantic magazine had a good round-up of the State of American Beer, based on a report from the trade publication Beverage Industry. Beverage Industry’s March issue had a series of articles on different segments, including Craft brewers’ sales growth continues, Domestic beer case sales decline, Mexican beers dominate imported beer growth and Hard cider draws in consumers from outside the beer category. In addition, at the same time they released a separate report, the 2014 U.S. Beer Category Report.
You could spend the time to read through all of them (and I’d encourage you to do so) but to get an overview of the reports, The Atlantic’s coverage provides the highlights (and even does a better job with the charts). For example, here’s the top craft brands from 2013.
And here’s case sales by brand in a piechart.
And this last one, the percentage change in case sales, is amazing because is shows just how fast Lagunitas is growing, though Stone’s doing pretty well on the growth front, too.
The Brewers Association has also just announced the top 50 breweries in the U.S. based on sales, by volume, for 2013. This includes all breweries, regardless of size or other parameters. Here is the new list:
Here is this year’s press release.
Not too much movement again this year, except for a few small shufflings, and no changes at all in the top ten. Only three new breweries made the list; Ballast Point, Narragansett (which had been on the year before in 2011) and Left Hand Brewing.
For the past six years, I’ve also posted an annotated list, showing the changes in each brewery’s rank from year to year. This year, the BA thoughtfully has already done that, saving me a lot of time and math. If you want to see the previous annotated lists for comparison, here is 2012, 2011, 2010, 2009, 2008, 2007 and 2006.
In a strange turn of events, Anheuser-Busch InBev (ABI) has agreed to buy back the South Korean Oriental Brewery (OB) for $5.8 billion, about three times the $1.8 billion that they sold it for in 2008. OB is South Korea’s largest brewery with approximately 60% of the market.
From the press release:
KKR and Affinity Equity Partners (“Affinity”) today announced that an agreement has been entered into whereby AB InBev will reacquire Oriental Brewery (“OB”), the leading brewer in South Korea, from KKR and Affinity for 5.8 billion USD.
This agreement returns OB to the AB InBev portfolio, after AB InBev sold the company in July 2009, following the combination of InBev and Anheuser-Busch, in support of the company’s deleveraging target. AB InBev will reacquire OB earlier than July 2014, as it was originally entitled to under the 2009 transaction.
Since KKR and Affinity entered into partnership with OB in 2009, OB has grown to become the largest brewer in South Korea, driven by strong growth of the Cass brand. OB and AB InBev also remained long-term partners through OB’s exclusive license to distribute select AB InBev brands in South Korea such as Budweiser, Corona and Hoegaarden.
Carlos Brito, Chief Executive Officer of AB InBev, said, “We are excited to invest in South Korea and to be working with the Oriental Brewery team again. OB will strengthen our position in the fast-growing Asia Pacific region and will become a significant contributor to our Asia Pacific Zone.
Bloomberg Businessweek also has more on the story.
If you saw my post from this morning about Beer Sales Dropping. The original story mentioned nine brands that have, according to Beer Marketer’s Insights, “declined by more than 25% over the past five years.” 24/7 Wall St. listed the Nine Beers Americans No Longer Drink. They are:
- 9. Labatt Blue — Sales loss (2007-2012): 28.3%
- 8. Budweiser — Sales loss (2007-2012): 28.8%
- 7. Heineken Premium Light — Sales loss (2007-2012): 36.7%
- 6. Milwaukee’s Best Light — Sales loss (2007-2012): 39.7%
- 5. Old Milwaukee — Sales loss (2007-2012): 54.0%
- 4. Miller Genuine Draft — Sales loss (2007-2012): 56.4%
- 3. Milwaukee’s Best Premium — Sales loss (2007-2012): 58.5%
- 2. Budweiser Select — Sales loss (2007-2012): 61.5%
- 1. Michelob Light — Sales loss (2007-2012): 69.6%