Good Beer Hunting

It’s a Small World After All — Rise of Global Craft Markets Impacts U.S. Exports


In an announcement last week, the Brewers Association shared its annual report on exports from organization-defined craft brewers, highlighting 482,309 barrels sold around the world in 2017, valued at $125.4 million U.S. Both are impressive numbers, putting the total volume on par with annual outputs from breweries like Bell’s or Oskar Blues.

Last year’s numbers only highlight half of the story, however, as the overall export growth slowed to 3.6% year-to-year, a precipitous drop from five years ago, when 2013’s volume grew by almost 50%. The situation for craft beer abroad is settling into a situation that parallels home: overall numbers are still growing, they’re just slowing. When comparing total U.S. export numbers reported by the Beer Institute, BA-defined craft beer remained up between 8.4% and 8.8% from 2014 to 2016, falling slightly to 8.2% of reported exports in 2017.

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Part of the change is due to the drop off of some of the largest BA-defined “craft” options as businesses like Goose Island and Lagunitas have expanded their international presence in recent years following acquisitions by Anheuser-Busch InBev and Heineken, respectively. But the overall volume is still buoyed by Brooklyn Brewery, which says it exports about 150,000 BBLs/year, roughly a third of the Brewers Association’s count.

Still, what is happening reflects overall changes in the industry, where out-of-market exposure—that is, outside a home city, state, or country—is becoming more calculated. It’s a strange monster created by American craft beer’s own success. Where foreign markets once yearned for and learned from U.S. beer, inspiration has turned to practice, and homegrown industries have thrived.

Whereas exporting may have once seemed a viable long term goal, the beer world has shrunk in terms of possibilities for awareness, with websites and message boards spreading the word of small breweries around the globe. In Iceland, a small brewery from Herndon, Virginia can gain traction, and in the UK, American hops have set a new level of interest for a brewery from, of all places, Wyoming.

At the same time, UK breweries are setting down roots, expanding into London to not just to claim market share, but take advantage of own-premise business practices learned from U.S. breweries. In Australia, where just under 4% of U.S. craft beer exports are shipped, 2017 ended with 420 breweries, up 14 fold from a decade prior. Even China’s growing middle class has helped shift that country's potential for craft beer, with the number of craft breweries tripling from 50 in 2015 to 150 in 2016. Goose Island, no longer defined as Brewers Association "craft," is cashing in on the latter.

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All around the world, just like back at home, opportunities have to be more thoughtful and strategic to foreign exposure. If you’re not Goose or Lagunitas with tons of money to expand international presence, or Stone Brewing with a production facility in Europe, it can be about building hype and keeping a business’ name in front of enthusiasts. But diving in now seems like less of a sure bet than it was in recent years.

Last year, the Maine Brewer’s Guild rallied 50 in-state members to participate in the “Maine Beer Box,” a custom-made shipping container full of Maine beer with 78 taps sent to Reykjavik, Iceland. A one-time deal, the effort became a media success as much as a practical one, highlighting excitement that can take place when U.S. beer arrives on another country’s shore.

More recently, Chicago’s Half Acre Beer Co. and Wyoming’s Melvin Brewing announced partnerships to send occasional shipments to the UK, to fulfill a need for the “audacity of hop character produced in the U.S.”

“We always try to import something unique and exclusive for our accounts, and working closely with Half Acre is a great opportunity to highlight that, done right, short-shelf life American beers can make it over to the UK and be drunk as fresh as intended,” Kent-based distributor Cave Direct Neil Kitching told GBH at the time.

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Steve Parr, the Brewers Association export development program manager, says that maximizing opportunities for U.S. beer is important and can lead to more attention for American craft beer, even if it’s just for brief moments in time. Diversifying sales opportunities abroad increases potential for growing a business at home, no matter how small.

Among one of the benefits offered through the BA’s export program is a vetted list of foreign importers and distributors who meet standards for cold chain shipping, retail partners, staffing to focus on new brands, and more.

“It shouldn’t be a beer dump because there’s some extra beer laying around,” Parr says. “It’s not just throwing a couple pallets of beer on a tanker and sending them to China.”

Interest in U.S. beer and its influence around the world has perhaps never been so high, but that popularity has come with its own drawbacks. Craft fans at home in the U.S.—even in a slowing beer category—are still showing plenty of interest while their beer-loving peers are now doing the same for native brands created in the UK, Asia, and other locales.

Not only has this change been presented in the numbers surrounding craft exports, but aesthetically, too. For years, the Brewers Association has included a map with its annual release touting export success, but something was different for 2017. Countries used to be labeled with percentages of growth by volume, giant numbers stamped over continents to show U.S. craft’s success around the world, sometimes three digits long, showing increases in the hundreds of percent.

This time, it was labeled simply, showing overall percentage of exports by country. A large “3.6%” hanging over the Atlantic Ocean, representing the slowing growth that was once so prominently displayed.

—Bryan Roth

For more insight on the changing nature of American exports, see Matthew Curtis’ 2017 Critical Drinking piece, “First We Came For Their Culture — American Craft Brewing’s British Offensive.”