Jim Koch In NYTimes: Consolidation Threatens Craft Beer

Has Big Beer finally gotten the upper hand over the craft movement?

Industry pioneer Jim Koch fears so. In an op-ed column published in the New York Times this past weekend, the founder of the Boston Beer Company worries that continued consolidation in the industry signals tough times ahead for microbreweries.

More specifically, he regrets the recent mega merger between SABMiller and AB InBev. That move follows similar consolidations around 2008, he points out, when Molson Coors and SABMiller joined together; soon after, so did Anheuser Busch and InBev.

The end result is that “90 percent of domestic beer production [is] in the hands of two foreign-owned brewing giants.” This consolidation brought job loss for Americans in the brewing industry, Koch says, while the price of beers in our country increased 6%.

Moreover, these mergers could wreak havoc upon U.S. craft beer. (And it seems they already are.) As corporations purchase microbreweries and suck up resources, what’s left over for the little guys, the local and regional craft brewers? Koch worries:

“Get some craft brewers really talking, and they’ll tell you we are headed for a time when independent breweries can’t afford to compete, can’t afford the best ingredients, can’t get wholesalers to support them, and can’t get shelf space and draft lines. The result: Beer lovers won’t have the broad range of choices they have today.”

Koch’s concerns are well founded, and convincingly argued. While in many ways its high time for U.S. craft beer — with more consumers and microbreweries than ever before, and quality product to meet the demand — there remain ominous signs upon the horizon in the broader industry.

Kyle Swartz is managing editor of Beverage Dynamics Magazine. Reach him at kswartz@epgmediallc.com or on twitter @kswartzz. Read his recent piece 10 Craft Beer Trends In 2017.

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