Millar's Tale: Crossroads for craft beer

It’s strange but true that just five or six years ago customers were willing to travel considerable distances to get their hands on new and edgy beers from the latest craft breweries.

Distribution was poor, knowledge was limited, and production volumes were small.

Around 2012, I distinctly remember one customer popping in every week to find out if I had anything from Magic Rock on the shelves. Before The Kernel moved to its new premises, we sold its beer more quickly than they could brew it.

Magic Rock, like The Kernel, Siren, Cloudwater and many other small breweries, is committed to walking the path of independent, small-production, adventurously made craft beer. But the craft brewers, who have deliberately resisted anything so bourgeois as a legal definition for their product, now face a dangerous lack of clarity. The lack of widely adopted labelling standards or boring old legislation to define craft breweries has meant distinctions that have never been universally agreed are now even more blurred.

Customers are bewildered, despite their best intentions. While more than half of beer drinkers in the US claim independence is a key factor in their purchasing, 88% of the beer sold in America comes from the big brewers. Something doesn’t add up.

Beer giants such as AB-Inbev own more than 100 “craft” brands, including Camden Town, while Brewdog rubs shoulders with Pabst Blue Ribbon under the aegis of private equity group TSG Consumer Partners, and Beavertown shares bar space with Heineken, which recently bought a minority stake in the Tottenham-based company. Who can blame customers for being confused about which is independently owned craft, minority-owned craft and nothing-left-but-the-logo craft?

Despite paranoid conspiracy theories that the big brewers are attempting to control the world’s hop supply, the reality is that big brewers are using craft credentials to premiumise beer. As with most mature drinks markets, value growth is much more important than volume growth. Craft credentials justify a premium. After all, there’s only so much you can charge for Carling. But Hop House and Goose Island? With their so-called craft credentials, they can demand a premium price – and the drinker is often none the wiser.

But if craft beer is just about nifty logos and funky labels, then there’s no reason why it should be the preserve of craft breweries. It isn’t, like wine, a matter of mystical terroir and the whims of Gaia, but a recipe that can be reliably followed. Since the vast majority of beer drinkers will choose their beer based on flavour rather than provenance, this puts the real craft brewers in a difficult position. How is the average drinker to know?

In addition, beer can scale up and retain quality. Many excellent beers are produced in quantities that would make wine producers gasp. The Augustiner Bräu brewery, home of an excellent helles, produces around 170 million litres a year, which is about half the annual wine production of New Zealand.

As the dust settles on the craft beer revolution, and in the absence of clear provenance marks or legislation, finding the truly craft breweries mainly comes down to doing your homework, or finding someone who has done theirs. As a result, it seems that promoting the cause of genuinely craft beer will once again become the preserve of those who care – namely small independents in both the on and off-trades.

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