Yes, Anheuser-Busch InBev Hates Your Beer.

Since its emergence on the North American beer scene in the 1980s and, in force, in the 1990s, what is commonly called ‘craft beer’ has cost the big breweries millions upon millions of dollars in revenue from lost sales. They do not like this.

Sales of Budweiser in particular have fallen precipitously, declining from 50 million barrels in 1988 to only 18 million in 2013. Some of that volume has simply been transferred to Bud Light, for years now the best-selling beer in the United States, while large volumes have also been lost to Coors Light, but some has also gone over to craft beer. Anheuser-Busch InBev definitely does not like this.

Since almost the very start of the craft beer renaissance, brewers and beer marketers have been taking pot shots at the big breweries and their beers, often aided and abetted by the media. While initially it must have been easy for pre-InBev Anheuser-Busch to shrug these insults off, the volume of such criticism now, coupled with the recent boom in the growth of craft beer, must certainly be getting up their corporate nose.

In order to stay relevant, Anheuser-Busch InBev has been forced to spend tens of millions of dollars on brewery purchases, only to have every buy followed by loud and prolonged condemnations. Would they rather have spent this money on increasing sales of their existing brands? You bet your ass they would!

Anheuser-Busch InBev has also spent tens of millions of dollars, if not hundreds of millions, on new product development and marketing in order to have what are, for them, fringe brands that can play in the specialty beer market (which did not even exist as such forty years ago). It’s not hard to imagine they would have rather spent this money on growing their existing portfolio of brands or perhaps developing more logical and demographically-focused line extensions.

So yes, if you drink craft beer, Anheuser-Busch InBev does indeed hate your beer. And if they could end the craft beer segment tomorrow by taking a loss on all the brewery purchases they have made and craft beer-style brands they have developed, I firmly believe they would do so in an instant.

Hungry? Three Beer Cookbooks for Your Kitchen

I had hoped to get this post up before I left for Belgium last week, but unfortunately ran out of time before I was able. Hopefully there are still some of you out there who have yet to complete your beer-associated shopping this year and can still use this info. (After you pick up last year’s World  Atlas of Beer and the new Pocket Beer Guide, of course!)

Following a bit of a lull, there has been a relative explosion in craft beer cookbooks this year, including the three that I found arriving upon my desk this fall. Each has something quite different to offer.

Begin with the Basics: David Ort’s Canadian Craft Beer Cookbook is the sort of book any aspiring cook will appreciate, although I could understand it being seen as a little too simple by those who already know their way around the kitchen quite well. Recipes are mostly pretty rudimentary – from soft pretzels and Welsh rabbit in the “Snacks” section to mains like sausages and lamb shank and desserts such as ice cream and brownies – but are also well organized, prettily photographed and come (mostly) with a suggested beer pairing, to boot. I might have liked to see a bit more about beer included – it is a large part of the title, after all – but in general this is a good pick for beer aficionados with an interest in cooking.

More Advanced: the south-of-the-border yang to Ort’s yin is John Holl’s American Craft Beer Cookbook, and it is a beauty. Here, the recipes all come from beer places, much as they did in my 1997 Stephen Beaumont’s Brewpub Cookbook – take that all you reviewers writing that Holl’s book is the first of its kind! – and there is plenty here to set your mouth to watering, like pan-roasted sweetbreads in a sherry-bacon vinaigrette, cocoa-crusted pork tenderloin and Asian-grilled salmon salad. In fact, leafing through the book for the umpteenth time since I received it, I still cannot find a dish I don’t feel like cooking, which is impressive considering that the thick paperback contains 155 recipes! Like its Canadian counterpart, some dishes contain beer while others don’t, but here only some have beer pairing recommendations, and frankly there seems to be no rhyme or reason to why that is the case or why those specific beers are suggested. But all that said and done, I still find this to be a most appetizing cookbook.

And for a Relaxing Read: Fred Bueltmann’s Beervangelist’s Guide to the Galaxy is a cookbook, yes, but it is also so much more. The New Holland Brewing owner and advocate includes in his self-published work much of what I bemoan as absent in the two above books, including 15 pages on “The Art of Pairing,” multiple sections on beer styles and the seasonal suitablility thereof and even a couple of pages on building your own beer cellar. On the downside, the layout can seem a bit muddled and confused at times, the quality of the photos could have been improved and a tighter edit would have been to the book’s benefit. Still, it’s an entertaining read and Bueltmann’s passion for bringing beer to both the kitchen and the table shines through on every page.

Interesting Numbers from the World of Beer

Item 1: People keep asking me why I see a bright future for craft beer in Brazil despite all the significant obstacles – lack of distribution infrastructure, high prices, no “cold chain” of delivery in which the beer is kept cold from brewery to consumer – and sometimes I wonder about it myself.

Then I come across an article like this one in The Globe and Mail newspaper and it all comes together. In case you don’t want to read the whole story, or the link breaks because the Globe puts the story behind their pay wall, here’s the gist: With 50 million Brazilians joining the middle class in the last decade, that segment of the population is now about equal to the percentage that is poor, about 30% each.

This new middle class is aspirational, and they want to spend their money on items to which they previously had not enjoyed access – the story highlights perfume and cell phones – like craft beer. I’ve seen the gestation of this at bars like Melograno and FrangÓ in São Paulo and I expect to see a lot more of it on my next visit, whenever that might be.

Item 2: I continue to hear American brewers fret about the number of breweries popping up in their country, worried about the so-called “bust” that they think must surely follow the boom. Too many breweries, too many SKUs (brands listed with distributors) and too confusing for beer drinkers are a few of the concerns I regularly hear voiced.

Umm, folks, ever heard of the United Kingdom? It’s a land of about 62 million people, where the total number of breweries just surpassed 1,000! And while they have their own issues to deal with over there, I’ve not yet heard much in the way of griping about the number of breweries and possible saturation of the market.

To put that in perspective, to achieve the same ratio of breweries per capita, the United States would have to add about 2,900 breweries to their existing total, more than doubling the number in place today.

Item 3: This is not so much a numbers thing as it is a bit of a rant. Although it does relate to Item 2 above.

Yesterday’s Shanken News Daily carried a story headlined “Craft Controversy: Rotating Drafts Spark Concern Among Brewers,” in which it was suggested that “some craft brewers are beginning to show concern that the very diversity that they have long promoted…may actually be damaging to their companies and the craft beer category.”

The piece goes on to quote Bob Sullivan, vice president of sales and marketing at Kansas city’s Boulevard Brewing – a craft brewery I know and quite like and the tenth largest craft producer by volume in the U.S. – as saying that bars which rotate their draft taps rather than sticking with a specific line-up of brands are hurting the industry by not giving breweries an opportunity to build their brands.

More egregiously, the story quotes Jim Gray, national draft director at the beer importer Crown Imports, purveyors of Corona and Tsingtao, among other brands, as complaining that “retailers who are focused on rotating draft handles aren’t focused on building brands” and that these beer sellers are only interested in “the shiny new toy that is offered to them each month.”

Here’s a piece of advice for you, Jim and Bob and any other salesperson out there trying to flog draft beer: The job of the licensee is to keep their customers happy, not to build brands. (Ahem, that’s YOUR job.) And if customers want variety in their beer selection, as a vastly growing contingent of beers drinkers do, well, that’s just the new playing field. Get used to it!

Good News/Bad News for Craft Beer in Brazil

If you’ve had a chance yet to look at the Emerging Markets chapter of the new World Atlas of Beer, you’ll know that my co-author and I are quite bullish on the future of craft beer in Brazil. With a fast-growing middle class, rapidly improving craft breweries and both the summer Olympics and football’s World Cup around the corner, we can’t help but think that things look bright for the country’s ever-expanding premium beer segment.

Since I’m writing about Brazil, I figure I might as well add a gratuitous cover shot from the Brazilian edition of The World Atlas of Beer.

And apparently we’re not the only ones.

The global research firm, Mintel, has just come out with a report that suggests “strong and premium beer” are the big growth segments in Brazil, with data showing sales had improved 18% year-on-year to 2011.  In the report, Sebastian Concha, research director, Latin America at Mintel, is quoted as saying:

“The fact that premium beers are gaining more market share from the standard beer sector highlights the changing consumer mindset in Brazil and how beverage habits relate to this. Huge opportunities lie with Brazil’s hosting of key live sports events in the coming years. With a strong sporting prowess in Brazil and a product closely linked with sporting culture, beer manufacturers who can capitalize on local enthusiasm and blend this to ensure a premium product positioning stand to benefit.”

Now, admittedly, by “premium” Mintel means primarily imports and niche domestic brands like the Kirin-owned Devassa and Heineken-owned Kaiser Bock, but it doesn’t take much imagination to figure that the crafts should be able to capitalize on this movement, as well. After all, what was then just InBev unwittingly helped along the rise of craft beer in North America by promoting the hell out of its imported brands.

Which, unfortunately, is also where the bad news comes in. Moments after I received the Mintel report, I also found in my inbox a news item about the intent of Anheuser-Busch InBev’s Brazilian division, AmBev, to open a chain of bars called Nosso Bar across the country. Organized via a semi-franchise arrangement, the bars will reportedly present a clean and gender-neutral image and be designed, of course, to fiercely promote AmBev brands such as Brahma and Sköl.

To be clear, I don’t believe that the latter news in any way outweighs the former — I remain convinced that the future is bright for Brazilian craft beer, despite the barriers the breweries still must overcome — but with AmBev and the other large breweries seeing great revenue potential in South America, the road ahead will likely be anything but smooth.

Global Craft Beer Future – India

During the beery explorations that resulted in The World Atlas of Beer, Tim Webb and I hit upon the two markets we consider most important to the future of brewing world-wide. Not craft brewing, mind, but brewing in general. They are China and India.

Neither has high per capita consumption levels – China drinks about 34 litres per person per year, while India languishes around one, yes, one litre per head annually – but both are growing markets and one, China, already produces more than twice as much beer as the second largest brewing nation in the world. India’s production sits at a very modest 26^th place globally.

But beer consumption is growing, slowly, in both markets, partly because increased affluence allows for greater purchasing power among the middle class.

India, however, is primarily a spirits market, as evidenced by the fact that United Spirits, the country’s top distiller, is also the number two spirits company in the world when measured by volume of product sold. And now Diageo is poised to take control of it.

With an offer of $1.8 billion on the table, Diageo is expected to assume majority control of United Spirits and thus gain ownership of a vast portfolio of brands and, perhaps more importantly, access to an expansive distribution network for its own global brands. This will place the world’s largest drinks company in a steel cage match for market presence with its chief rival, Pernod Ricard.

It will also likely put on hold for possibly several years any significant growth in the Indian beer market. Why? Because with two spirits behemoths going head-to-head in what is primarily a spirits marketplace, there is likely to be little room left over for beer growth, especially when the inevitable marketing and price wars heat up.

The good news in all this is that I’m told reliably that a small but enthusiastic craft beer market is just beginning to develop in India, the existence of which will probably not even be noticed by the two Goliaths hammering each other for market share. Bad news for A-B InBev, SABMiller, Heineken and the rest, but good news for the small minority of Indians thirsting for good beer.

The Beaumont-Webb Travelling Road Show

You may have noticed that I haven’t been posting much of late. Indeed (gulp!) for the last three weeks. There are reasons for this.

Reason number one is travel. As those of you who follow me on Twitter (@BeaumontDrinks) will know, I’ve been all over the place lately, and keeping on top of my various columns and assignments is almost all I can manage when I’m on the road.

Reason number two? That would be the prep time I’ve been spending getting organized to write my next book, but more about that at a later date.

And reason number three is the impending North American release of The World Atlas of Beer, the book I’ve co-written with Tim Webb. We’re pretty damn happy with it, and initial reviews have thus far been most encouraging. So we’re going to take this sucker on the road!

That’s right. Starting in early October, the esteemed Mr. Webb, himself the author of seven editions of the Good Beer Guide to Belgium, and I are going to be making a series of appearances across the United States, with most events already organized and some with details TBA. Here’s how it all is shaping up:

October 4: During the afternoon (exact hours TBD), Tim and I will be signing books at Monk’s Cafe in Philadelphia, followed by a World Atlas of Beer dinner at the Belgian Cafe. See www.monkscafe.com and www.thebelgiancafe.com for details.

October 6: We’ll be at the World Beer Festival in Durham, North Carolina, appearing at both sessions. www.allaboutbeer.com/gather-for-beer/world-beer-festival/durham-nc

October 7: Come visit us at the Flying Saucer in Raleigh, North Carolina. Event details TBA. www.beerknurd.com

October 8: We’re flying into Dallas to see how Texans react to Tim’s British accent during a beer dinner at the Meddlesome Moth. www.mothinthe.net

October 9: Back on the road, this time to the Austin Flying Saucer for another appearance with details TBA. www.beerknurd.com

October 10: Once more with feeling, this time at the Sugar Land, Texas, Flying Saucer. www.beerknurd.com

October 11 – 13: It’s Great American Beer Festival time, and we’ll be there signing books during the Thursday, Friday and Saturday afternoon sessions. God knows what else we’ll get up to… www.greatamericanbeerfestival.com

October 14: Tim is off to Seattle for an as-yet-undisclosed event at an as-yet-undecided locale, but I’ll be popping up in Chicago for a beer and whisky tasting at Rockwell’s Neighborhood Grill. Hey, it’s a bye week for the Bears, so what else are you going to do!? www.rockwellsgrill.com   

Gift Idea #4: Craft Beers of the Pacific Northwest

One more book, folks, and it’s a good one!

I’ve been friends with Lisa Morrison, author of Craft Beers of the Pacific Northwest, for many years and have been anxiously awaiting her literary debut for most of that time. Thankfully she doesn’t disappoint. CBPN, as we will henceforth refer to this paperback, is an engaging trip from south Oregon through Washington state and across the border into British Columbia. It’s a beery wonderland and Morrison is a most adept guide.

Much like Max Bahnson’s Prague guide, which you might also like to get, Morrison’s…okay, I’m going to get all unjournalistic here and call her Lisa…Lisa’s approach is to put together pub crawls, within cities, between towns and along highways and coastlines. It’s the way most serious beer travellers plan their trips and makes sense in the vast majority of instances. (In BC, Lisa somehow manages to include Surrey’s Central City Brewing in a Sea-to-Sky Highway crawl, which any Vancouverite will tell you is more than a bit of a stretch.) The maps could sometimes be better, but that’s at best a quibble.

The real allure of this book, though, is Lisa’s voice, which is less guidebook-y and more let’s-go-drinking-together. Like Max’s book — which, again, you really should also get — it makes the reading pleasurable and thirsty work, drawing the reader to the locations in question like a moth to the proverbial flame.

The one thing I don’t like about CBPN is the colour scheme, which sees the sidebar brewery profiles and feature pieces, as well as the maps, illustrated in a yellowish-green that is none too easy on the eyes. But like the garish shirt your beer hunting buddy insists on sporting, it is a small price to pay for such good advice and company.

The Last I’ll Say About the Oxford Companion to Beer

I offer the following without commentary.

Garret Oliver on remuneration for the contributors to the book:

Of course, there is nothing I can do about the pay. Everyone here should realize that (1) academic presses never pay much – in fact, they often don’t even pay advances, and (2) OUP is a not-for-profit organization. Much of any surplus that may be generated by book sales goes back into education, including scholarships, other books and educational material, and the subsidization of massive works such as the Oxford English Dictionary. No one is getting rich here – everyone, myself included, has made far below minimum wage, and all the OCB writers I spoke to said that they did this partially to give something back to the brewing community. The fact that so many were willing to do so says something about that community. I understand that not everyone can afford to do this work, but I’m grateful to those who did.

Report published at thebookseller.com about Oxford University Press:

Oxford University Press has described a surge in pretax profit by nearly 25% as “excellent”, but said it does not underestimate the challenges publishers are facing.

The academic publisher has reported pretax profits of £122.6m in the 12 months to 31st March 2011, up from £98.5m last year. The company also increased sales by nearly 6%, to £648.6m in that period, up from £611.9m last year.

Thanks to Evan Rail for the link.

Craft Beer Up Again, Mainstream Beer Down Again

More good news for craft beer brewers and fans, courtesy of Shanken News Daily:

The U.S. beer market continues to struggle, according to the latest numbers from Nielsen. Off-premise volumes declined 1.9% in the most recent 52-week period (ending November 12) to 1.38 billion cases. The outlook appeared brighter on a value basis, as dollar sales inched up 0.6% to $28.6 billion during the same time period. The average price of beer in the off-premise increased 2.4% to $19.82 a case.

Craft and specialty brews continue to be the most vibrant segment in the beer category, surging 16.6% by volume in the 52-week period, with even stronger value growth (+17.8%) on an average price of $31.80 a case. The craft/microbrew segment is priced higher, on average, than imported brands ($27.59), yet imports fell 0.6% by volume during the same time span. Mexico continues to be the largest-selling origin for imported brews off-premise, at 78.7 million cases (+0.4%), but the fastest-growing source was Belgium (+28.9%).

Domestic beer sales posted a 2.1% decline in the 52-week period, with the super-premium ($24.12 a case) and below-premium ($14.71) segments falling 4.5% and 4.2% by volume, respectively. Even domestic light beers fared worse than the industry average, down 2.9% during the same period.

Nielsen tracks beer sales in food/drug/liquor/convenience stores and other channels, with volumes accounting for just over half the size of the total U.S. beer market, as measured by Impact Databank.

Over 16.5% volume growth in the middle of an overall 1.9% volume decline tells you that this shit is for real!

Interesting News From Brazil and the Netherlands

Just as I prepare to fly south to Argentina for the Great South Beer Cup and on to São Paulo for a couple of beer dinners comes word from Reuters that Heineken is seeking a second entry to the Brazilian beer market.

Already in bed with Cervejarias Kaiser, which it picked up from Molson after that latter’s disastrous foray into South America, Heineken is now reportedly mulling over the purchase of Brazil’s number two brewing company, Schincariol. If pursued, the purchase will reportedly cost in the area of $2 billion.

Even with Kaiser AND Schincariol, Heineken would still be trailing Anheuser-Busch InBev by a considerable margin in the rapidly developing market. But I’m betting the world’s largest brewing concern is paying very close attention to these developments nonetheless.