Brookston Beer Bulletin

Jay R. Brooks on Beer

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Join Me For A Beer Dinner At Anchor With Sierra Nevada

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Join me for a five-course beer dinner at the Anchor Brewery in San Francisco celebrating Sierra Nevada Brewing‘s 30h anniversary and the release of their first collaboration of the year, Fritz & Ken’s Ale, which is a stout.

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There are only five seats left for the beer dinner, which will take place on April 1 (no fooling). Here are the particulars.

Join two of the original craft-brewing pioneers for an intimate one-night-only celebration of beer and food at the historic Anchor Brewery in San Francisco. Anchor Brewing’s Fritz Maytag, and Sierra Nevada’s Ken Grossman will be celebrating the release of their collaboration beer, Fritz and Ken’s Ale, in honor of Sierra Nevada’s 30th anniversary. Come and join us for a 5-course dinner packed with unique rare and vintage beers, seated amongst the kettles in the legendary Anchor brewhouse.

Reception starts at 6:00 PM on April 1st, 2010 at Anchor Brewing Company, 1705 Mariposa Street
San Francisco, CA 94107

Five-Course meal, 11 interesting beers, and souvenir glassware.

$100 tickets, limited to 60 seats, no tickets available at the door.

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Tickets must be purchased online, they won’t be available at the door. You can get them at ClicknPrint Tickets. I’ll see you there.

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Ken Grossman and Fritz Maytag in the Anchor brewhouse, where the dinner will be held next Thursday.

MillerCoors: Is A Global Merger Possible?

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Several sources are pointing out a Reuters interview last week with Peter Swinburn, head of MolsonCoors. In that interview, Swinburn suggests that while he considers his company to be a “buyer,” he doesn’t discount the notion that MolsonCoors could be a takeover target. He further remarked that “SABMiller, Molson’s partner in the MillerCoors joint venture, would be a natural fit as a buyer.” While going on to say he doesn’t believe that will happen, this is, after all, how these types of things begin. A rumor that’s denied and discounted by all involved parties becoming a reality is nothing new, so you never know. Currently SABMiller is the 2nd largest global beer company and MolsonCoors in sixth. Though a merger wouldn’t eclipse A-B InBev at the top spot, it would move them closer together. Only time will tell.

The New Anderson Valley: A Chat With Trey White

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Recently it was announced that Ken Allen, who founded the brewery in 1987, is selling Anderson Valley Brewing to Trey White, a former USB executive. The response on the series of tubes we all know and love as the internet was swift and surprisingly negative. Also, there was quite a lot of speculation that was simply untrue. Even the local Anderson Valley Advertiser detailed some of the negative reactions. So I spoke with Trey White this morning to clear up some of the misinformation swirling around and get to the bottom of what he has planned for his brewery when he takes over next month, after the sale closes.

First, the biggest piece of misinformation, which I didn’t even need to talk to him about to correct. A number of negative comments took the form of “how sad, another case of a big business swallowing up a smaller one.” Wrong. White is a former VP with USB. That means he doesn’t work there any more, and in fact hasn’t for several years. I, and most of the accounts that mentioned his former job did so to show that he brings beer industry experience with him. That’s a good thing. It means he knows how the industry works. As I learned when I spoke with White, the business will be family-owned, just White and his wife. No big company in the background, just a mom and pop operation.

Here’s what else I learned about his plans for the brewery. White first visited the brewery three years ago and immediately fell in love with the place. He and Ken Allen have been discussing the purchase for nearly that long. He’s committed to its success and it wasn’t just a quick flash in the pan decision.

White and his wife currently live in downtown Chicago, ironically walking distance from the Craft Brewers Conference which will take place the first week of April. For the first six months to a year after taking over, the Whites will spend about 75% of their time in northern California. All of the current staff and brewers will remain in place and no changes will be made to any of the recipes. The first year, some of the packaging may be changed and it’s possible some additional styles and/or special releases will be created.

The Boonville Beer Festival will be unchanged and the planning for it will continue apace and it will be held, as scheduled, on May 8. The Disc Golf Course will also remain on the brewery grounds.

While the brewery continues to hum along, White will turn his attention to what he knows best: marketing, merchandising and selling. He’ll immediately begin working to increase distribution and get Anderson valley beers into a greater number of chain locations, making it even easier for fans to find the beer in a wider array of outlets.

Ken will be the first to tell you that his passion for the brewery has not been 100% over the last few years and he’s been looking forward to taking a much needed rest from running the business. Ken had this to say, in the press release:

“I have enjoyed immensely growing the Anderson Valley Brewery from a start-up operating a modest brew pub in Boonville into a world class regional craft brewery. The people and friends I have made in the industry will last a lifetime. I want to thank the many customers and brewery fans who have become key parts of the Anderson Valley Brewery family.

I have looked long and hard for the right person to whom to entrust our legacy and I could not have found a better partner in Trey White. His passion and knowledge of the craft beer industry, coupled with his respect for the brands we have developed, will make him the ideal person to take the Anderson Valley Brewery to the next level within the growing craft beer industry.“

So I can’t help but think this will a positive step for everyone, from Ken Allen, the new owners and fans of the brewery’s beers. In talking with Trey White, he has that passion that can propel the brewery to the next level. He seems sincere in his reverence for the brands Anderson Valley has created over the years and has no plans to alter them in any way. He has the right experience and contacts to grow the business successfully while keeping it true to its roots. Let’s wish Ken a happy retirement and Trey good luck with his new job as a small brewery owner.

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The changing of the guard: new owner Trey White, at left, with founder Ken Allen in the Anderson Valley brewhouse.

Mergermania & The Global Beer Picture

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Yesterday Charlie Papazian had an interesting post about recent production numbers of brewers worldwide and how the top Four brewing companies control 50% of the world’s beer. That’s due to the increasing mergermania in the brewing industry, with the recent purchase of Mexico’s FEMSA by Heineken but not including the announced acquisition of Grupo Modelo by Anheuser-Busch InBev. According to a UK Reuters report, the Top four brewers make up half [the] global beer market. The supporting data comes from a researcher for Plato Logic, a beer industry analyst company in Great Britain that produces their world beer report each October. Presumably his statistics are preliminary, taking into account changes in ownership that have taken place since the last report.

But roughly, here’s what his data shows in a chart I made, using the estimates given for millions of hectoliters produced by the top five beer companies. It shows the relatives sizes of them, and how the top four are so far out in front that it’s almost ridiculous and frankly, you can make that same argument for the top four or the top three. There’s a lot of separation, but one big merger and the deck gets shuffled again.

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Though the production numbers aren’t given for the bottom half of the top ten, here they are by rank.

  1. Anheuser-Busch InBev
  2. SAB Miller
  3. Heineken
  4. Carlsberg
  5. Tsingtao
  6. MolsonCoors
  7. Grupo Modelo
  8. Beijing Yanjing Brewery (China)
  9. Kirin
  10. Asahi

Estimating world beer production (it’s not given in the article) from the Beer Institute’s Brewer’s Almanac, I made the chart below to show how the top four do indeed account for just north of half the beer produced in the world.

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And finally, including number five Tsingtao, here’s how the overall picture looks.

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Anderson Valley Brewery Sold

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There have been rumors floating around for a few months now, and it’s been no secret that owner Ken Allen has been trying to sell his Anderson Valley Brewery for several years. According to the North Bay Business Journal, it looks like a sale is now official. The terms have not been disclosed, but pending the necessary approvals, a sale is expected to close next month. The buyer is HMB Holdings LLC, a company created for the purchase by Trey White, a former VP with United States Beverage. In addition to the USB portfolio, White has also worked with such brands as Goose Island, SLO and Grolsch. Anderson Valley will continue to be brewed at its present facilities in Boonville, California.

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Odonata Website Launched

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Sacramento’s newest brewery, Odonata Beer. Co. — recently founded by formed Sacramento Brewing’s Peter Hoey and former DRAFT magazine beer director Rick Sellers — has just launched their new website, which for months has been essentially wallpaper. For updates, there’s also the brewery blog, too. You can also get a look at the now-approved label for what they hope will become their flagship beer, Saison Ale. It’s great to see things moving forward. Hopefully there will be beer to fill the bottles with those label very soon.

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National Action Alert: Help Craft Brewers Reduce Taxes

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If you’re a regular Bulletin reader, you’ve already seen me rant about how unfairly taxes are levied on the brewing industry, who has to pay more taxes than any other product sold in America, except tobacco. With the help and support of the Brewers Association, H.R. 4278 has been introduced into thee U.S. House of Representatives seeking a redress of those egregious taxes. The BA has issued a national action alert, asking beer lovers everywhere to contact their elected officials to ask them to co-sponsor the bill. Here’s the press release:

Federal legislation in the U.S. House of Representatives, H.R. 4278 (link opens a PDF), seeks to enact a reduction in beer excise tax for America’s small brewers.

For small brewers brewing less than 6 million barrels annually, this legislation would cut the small brewer tax rate in half, to $3.50/barrel on the first 60,000 barrels, and reduce the upper tax rate from $18/barrel to $16/barrel on beer production above 60,000 barrels up to 2 million barrels.

Of the 1,525 breweries in America, 962 are brewpubs and 470 are the smallest bottling breweries, which produce volumes of 15,000 barrels of beer a year or less and sell their beers in local markets. Once barrel equals about 13.8 cases of beer.

The original small brewer tax rate of $7/barrel was established in 1976 and has never been updated. Since then, the annual U.S. production of America’s largest brewery increased from about 45 million to 107 million barrels and over 200 million barrels globally (or 1,240,000,000 five-gallon batches of homebrew!). Much has changed and the challenges small brewers face as small American businesses have grown dramatically since 1976.

Why is this a good idea?

  1. A tax reduction will help grow small business breweries and provide greater access to the beers you enjoy.
  2. Harvard University’s John Friedman’s study, Economic Impact of Small Brewers Excise Tax Reduction (H.R. 4278), (link opens a PDF), reveals that H.R. 4278 would also help stimulate job creation quickly and at a low cost:
    • The bill would generate more than 2,700 new jobs over the first year to 18 months, followed by an average of 375 new jobs per year over the following four years.

Please contact your U.S. Representative and ask that he/she sign on as a co-sponsor of H.R. 4278.

We have developed a resource page to give you the information and tools you need to make the case to your Representative for supporting this tax relief measure—and by extension, for supporting the small brewery businesses that are such a vital part of our local communities.

On the resource page, you will find a link to a list of current sponsors of H.R. 4278. If your Representative DOES NOT appear on this list, please take a moment and email your Member of Congress to ask them to cosponsor H.R. 4278.

If your Representative is already a cosponsor, please email him/her a brief thank you for their support of small brewers and you, the craft beer drinker and enthusiast.

Here’s some links to help you find out who your elected officials are so you know who to contact:

Okay, people get contacting. Your brewers thank you.

ABI To Buy Modelo This Year

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Grupo Modelo is the largest beer company in Mexico, and their most popular beer, of course, is Corona. For many years, Anheuser-Busch has owned a non-controlling 50% share of the company, but after the InBev merger they own 50.2% but only 49.3% voting. And I think they’ve been coveting control for a long, long time and now they may finally get it.

Yesterday, Reuters had an item, AB InBev to Buy Modelo This Year, suggesting it’s likely a deal will go through, and will be completed later this year. The price tag looks to be about $10.8 billion. Earlier this year, Heineken bought FEMSA, Mexico’s second largest beer company. So if ABI buys Modelo, the majority of the country’s beer market will be owned by foreign companies, just like in the U.S.

Craft Beer Numbers Up Again For 2009

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The Brewers Association released the 2009 numbers for craft beer today, and I’m happy to report it’s good news again. While mainstream beer recently reported their largest negative sales period since the 1950s, craft beer in 2009 was up 7.2% by volume and 10.3% by dollars over the previous year. According to the press release, that represents “a growth of 613,992 barrels equal to roughly 8.5 million cases. Overall, U.S. beer sales were down approximately 5 million barrels (31 gallons per U.S. barrel) in 2009.”

From the press release:

In 2009, craft brewers represented 4.3 percent of volume and 6.9 percent of retail dollars for the total U.S. beer category. With the total U.S. beer industry representing an estimated retail dollar value of $101 billion, the Brewers Association estimates the actual dollar sales figure from craft brewers in 2009 was $7 billion, up from $6.3 billion in 2008.

The total number of U.S. craft brewers grew from 1,485 to 1,542 in 2009, and they produced 9,115,635 barrels, up from 8,501,713 barrels in 2008. Overall U.S. beer sales fell from approximately 210.4 million barrels to 205.8 million barrels.

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And here’s the BA’s updated fact sheet:

  • Growth of the craft brewing industry in 2009 was 7.2% by volume and 10.3% by dollars compared to growth in 2008 of 5.9% by volume and 10.1% by dollars.
  • Craft brewers sold an estimated 9,115,635 barrels of beer in 2009, up from 8,501,713 in 2008.
  • Overall, US beer sales were down 2.2% in 2009.
  • Imported beer sales were down 9.8% in 2009, equating to a loss of 2.8 million barrels.
  • The craft brewing sales share in 2009 was 4.3% by volume and 6.9% by dollars.
  • Craft brewer retail dollar value in 2009 was an estimated $6.86 billion, up from $6.32 billion in 2008.
  • 1,585 breweries operated for some or all of 2009, the highest total since before Prohibition.