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Consolidation Blues : Take My Brewery, Please!
By Tom Dalldorf

The craft segment of the beer industry is on a tear, showing the only positive growth in overall lackluster domestic beer sales. The big breweries, stung by falling profits and pressured by wholesalers for higher-margin products, are looking for more profitable, upscale brands to fill the slack in sales. The recent gathering of beer-industry professionals in Seattle was awash in rumors of mergers, acquisitions and distribution deals in the works.

Of the big three, Anheuser-Busch is the most proactive, introducing brands and styles never before offered by the brewing giant. A-B has also been successful in past investments/alliances with craft brewers (Widmer and Redhook). The brewer has even targeted the niche market with its Jack’s Pumpkin Spice Ale, Winter’s Bourbon Cask Ale and wit-style Spring Heat Spiced Wheat. Most recently, Grolsch and Rolling Rock have been added to the A-B roster. We can assume there will be more of these in the future.

Foreign-owned SABMiller and Molson Coors have made similar arrangements. Miller's acquisition of the Czech Republic's crown jewel, Pilsner Urquell, has resulted in the "original" pilsner now being made in Poland and Russia under contract. While you may hear Czech hearts breaking, Miller hears increased sales. Canada's Sleeman Breweries purchased famed Unibroue in Quebec.

The consolidation on the distribution tier of the beer industry is brutal, leaving some very large markets with only one or two distributors wielding massive books of beer, wine, spirits and such. Faced with diminished access to market, some small breweries look at alliances or acquisition as their only hope for survival.

InBev (formerly Interbrew) of Belgium is notorious for its own role in "consolidation," buying up struggling breweries and shutting them down to enhance its own market share. Most recently, InBev announced that it would shutter the famed Hoegaarden Brewery in its namesake town and continue producing the beer at its Jupiler Brewery. Pierre Celis, who reintroduced the extinct wit style in his hometown and named it Hoegaarden some 40 years ago, was understandably outraged.

Brewery consolidation in some cases may be beneficial and necessary, but in other situations it can be a travesty to the character and quality of the beers we so admire. This is a time for beer lovers to pay attention to the business side of beer appreciation. The Brewers Association recently released statistics that indicate that nearly every American lives within 10 miles of a brewery. Find the breweries, frequent them and let your local brewers know that you care about what you are drinking. Respect for the flavors and traditions of brewing begins with production and ends with consumption. Lack thereof can lead to the loss of your local brewery. Let’s keep it real in this, the age of good beer.

LETTERS | Our readers in their own write...
If your letter is accepted for publication, you will receive a gift, ranging from a free subscription (or sub extension) to a Celebrator T-shirt. What's on your mind? — Ed.

Dear Editor:

I recently had an unfortunate beer experience that necessitated the addition to the beer lexicon of a new word: beerbarian (noun), one, or more than one, who feels free to invade another's house and consume the craft beer found in the refrigerator, either replacing it with Bud or not replacing it at all. Take a lesson from the pirates and consider burying a fridge in the back yard with your liquid treasure safely secure from the greedy, bony hands of the foul beerbarians. I hope to warn others so that these marauding predators cause no more harm than they already have.

Ken Klemm
Oxnard, California

Dear Ken:  

The beauty of craft beer is that it is not so expensive that we can’t share it with the taste-challenged "beerbarians." I like the concept and hope you will join us in converting them. That way, when you go to their house, you can return the favor. — Ed.

Dear Editor:  

During my long drive back to Wyoming after the ’06 Craft Brewers Conference, I got to thinking about the people I saw at the conference. Ralph Woodall came to mind. You can always count on seeing Ralph at any major event, even small ones. He's everywhere. The GABF, the CBC, the North American Beer Awards, the Mountain Brewers Beer Festival, the Oregon Brewers Festival and many others. What is amazing is that Ralph never seems to tire. He is always smiling, jolly and full of good jokes. I asked myself, "How does he do it?" I am almost convinced that Hopunion has made a scientific breakthrough and is cloning Ralph. Let's all raise a hoppy pint of brew and give "cheers" to Ralph… Or should I say Ralph's?

Richard Strom
Bottoms Up Brewing Company
Pinedale, Wyoming

Dear Editor:  

Thank you and John Rowling for the flattering article on our business, the Howe Sound Inn & Brewing Company, in “Pubbing Around B.C.,” Celebrator Beer News, February/March 2006. We are writing to correct an omission regarding our brewing operation. Our brewery is actually run primarily by two talented brewers. Fabian Specht joined Franco Corno in our operation over a year ago. Fabian brings a wealth of brewing knowledge and makes a huge contribution to our facility. Thank you again for your interest in craft brewing in Squamish, B.C.!

Deborah Laishley & Dave Fenn, Owners
Howe Sound Inn & Brewing Company
Squamish, British Columbia, Canada

Dear Editor:  

Once again, the necessity of including such far-flung brewing scenes as Philadelphia; Washington, D.C.; Tampa; Atlanta; and Oakland in Don Erickson's "L.A. Scene" column conclusively proves one thing: There is no L.A. brewing scene. It still sucks. I remain your loyal, "half-in-the-bag on San Diego beer" foot soldier.

Brian O'Hare
Los Angeles, California

Dear Brian:   I feel your pain, brother. I'm just back from Seattle and Portland (Craft Brewers Conference and Spring Beer Fest). Talk about an active beer scene! I sure hope L.A. comes along. Also, because of Don's real job, he gets to travel a lot and loves to write about new beer finds. Please let us know if you run across something that doesn't suck in the L.A. area, and we'll include it. — Ed.
Dear Editor:  

Read with interest your article on Vietnamese beer-making. I saw you made mention of 333 beer. We had a beer called Ba Muy Ba 33 Bière when I was stationed in Vietnam. We were told it had formaldehyde in it. Secondly, do you ever make comparisons of non-alcoholic beers? Do any of the microbreweries make non-alcoholic beer?

George Estabrook
Livermore, California

Dear George:   Don’t know about the formaldehyde but could believe it. A lot of older Vietnamese seem well preserved. The NA beers are done via an industrial process too expensive for small beer production. Our favorite non-alcoholic beers include Erdinger Alcohol Free and Clausthaler. — Ed.


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