Monday, September 10, 2012

The Session #67 Round Up: How Many US Breweries Will Exist in 2017?

Here is the round-up for month's Session, where I've asked everyone to predict how many US breweries will exist in 2017.


Thank you all for participating in one of the more analytical and grammatically incorrectly phrased Sessions.  I honestly enjoyed reading every one of your posts, which ranged from the very thoughtful, to the highly observant, to the gleefully off the wall.

As for who wins the prize, forgive the sappy cliche' but you're all winners, and I'll gladly buy a beer for each of you whenever our paths might cross.  I have every intention of blogging about beer five years from now, and if your prediction is the closest and your still out there in the beer blogosphere, I will find you.  And whatever beer you've earned, I promise it will be a good one from a brewery that currently does not exist.

I must admit to a having a small hidden agenda with this Session topic.   I'm not only a Beer Geek, and a Running Geek, but also a Techie Geek in real life.   I've personally witnessed bubbles and consolidation in obscure industries such as fiber optic components, solar panels, disk drives, carbide tools, and internet retailing.   And while craft beer has a distinctly different character and structure than those industries, all the new breweries going online and lots of brewery expansion pricked up my bubble antenna, which was reflected in my post predicting 2,697 breweries in 2107, where I saw a lot of choppy waters ahead for new brewing entrants.   What did other people think?

Alan McLeod of A Good Beer Blog also had concerns about a brewing crash wondering "Are we nearing something like that? I dunno. I have lived through enough recessions now to know they come out of now where..."

As for the rest, in semi-numerical order, here's what the rest of the fearless predictors had to say.

Over 5,000 David Blascombe of Good Morning... makes a number of interesting comparisons between the United Kingdom, where there is 1 brewery per 70,000 people, versus the United States, where this ratio is 1 to 150,000.  (If the United States had the UK's brewery to person ratio, it would currently have 4,430 breweries.)  He goes on to add "What I’d like to see is more smaller breweries supplying smaller communities. The best scenario I can imagine is a number of brewpubs opening across the country. Places where people can gather and drink beer. London has an increasing number of places which are like this."

5,001 is what Brian Yaeger of Red, White, and Brew expects five years from now, based on the comparative popularity of wine and beer.  He notes that while beer and wine are have roughly the same popularity, the number of breweries stands at 28% of the number of bonded wineries.  So what will all these new breweries look like?  According to Brian, there's going to be plenty of  "Tiny, nano, pico, "boutique," retirement-plan, post-law-career, I've-always-love-homebrewing-and-all-my-friends-said-I-should-go-pro breweries."

4,252 In their Session debut, The Brew Gentlemen wisely keep it simple and double the current number of breweries.  In justifying their prediction, they are encouraged by  "the incoming class of beer-frenzied greenhorns.....arriving at legal age in a much more colorful market than their elders did. This is, for the most part, the first wave of new drinkers who grew up around craft.....so they’re already used to having better options. This young crowd has an enormous amount of buying power, and thus, the ability to significantly boost the market share."

3,189 Alan McCormick of Growler Fills looks around his home state of Montana, which has the second highest breweries per capita in the United States, in coming up with his prediction.   He has doubts we'll see brewery it continue at the current rate, as some markets are likely to reach a bit of a saturation point, and expects a " temporary ingredient shortage that will push the pause button on a few."  And I supposed I'm biased, but you got to hand it to a beer blogger who's completed a marathon.

3,125 is the number Jon Abernathy of the Brewsite predicts, by assuming the 47% growth rate over five years will continue, although he thinks any number between 2,500-4,000 is reasonable.  But he confesses he really has no idea, since at one time, he thought his home town of Bend, OR had reached it's limit at 8-9 breweries, but now there are 15 active breweries in Bend, and another six in the planning stages.

Around 3,000 opines Sean Inman of Beer Search Party by the year 2017, adding "I firmly believe that way more than 5.7% of people want to drink more than corn water. It may not be a majority but I do see 15% as not out of the realm of reason.......But there will be an upper limit to craft beer. (And those will be interesting times to write in, let me tell you)."

2,831 is the number Chris Staten of DRAFT Magazine throws out.   Chris writes from his perspective as a beer journalist to share what he hopes the future of beer to look like, and hopes in five years, the brewing industry will "...keep me, the entire staff of DRAFT and the rest of the beer media on its toes so that we begin each work day wondering “what’s new, what’s unsampled?” and not fall into the laziness of beer snobbery and know-it-allism."

2,620 Stan Hieronymus of Appellation Beer calculates this number from a proprietary formula based on differing estimates for breweries in 1879.  He also quotes Oskar Blue's founder Dale Katechis from a recent interview on the subject of new brewery entrants.   Make sure you check out the interesting comments to his post.

2,589.5 is the prediction by What We're Drinking, who shrewdly adds a half brewery to break any ties.  Looking around his home town of Dayton, OH, he writes:   "I do think that 3-4 local, small scale breweries can be sustained within a city the size of Dayton..." and goes on to add "If growth becomes the model that these breweries pursue, however, I would expect to see the numbers drop, not only locally, but nationally"   It's worth noting the population of metro Dayton, OH is about 840,000.  If we extrapolate 3-4 breweries in that city to the United States population of 310 million, that works out to 1,100 to 1,475 breweries nationwide.

2,500 is the number by Roger Mueller of A Fool and His Beers based on a shocking and bold political prediction.  Using more conventional analysis of craft beer growth rates, he also comes up with brewery populations 3,014 and 3,209.

2 Mark Landell of Rock n Roll Beverage warns of brewing rivals conspiring with shadowy figures carrying bags of money will leave us with only two breweries five years from now.

1 A dire prediction that one megabrewer will control the world comes from Jon Jefferson of 10th Day Brewing, who also proposes the opposite scenario that breweries may proliferate like restaurants.  What will happen in the end?  According to Jon,  "Either way it will be the passion of those who are opening the breweries that will determine where we end up."

Desire Fellow beer runner James at Beer Bar Band extols the virtues of balancing beer and running (yes!).  He goes on to compare Australian breweries in his home country to those of the United States, and concludes with  "I’m not a betting man, I'll end with less of a prediction and more of a desire for 2017. In five years time I'd like to be actually working in the beer industry…maybe with a craft beer shop, maybe with a brewpub (better get that lotto ticket), more likely in communications support for the craft beer industry"  Let's raise a glass and wish him good luck with that.

Finally, we'll end with Bryan Roth at This Is Why I'm Drunk, who provides a number of sobering facts on the subject without making a prediction, concluding with "Craft beer is on the rise and it’s going to be a pretty damned exciting ride. Better hop on this train before it really leaves the station." 

We're all with you on that, Bryan!

So thank you all once again, and see you over at 99 Pours for next month's Session, where we'll wax poetically on novelty beers.

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