Good News Mid-Year!

BA releases mid-year craft growth – sales up strong despite challenges

The Brewers Association released today the mid-year growth numbers for the craft category. Despite a softening economy and challenges with raw materials supply and pricing, craft beer dollar sales during the first half of 2008 increased 11% compared to this same period in 2007.

This is a huge indicator that craft beers have and can survive, and in fact thrive, despite multiple challenges. With significant price increases in the category during the first half of the year, at the same time the economy turned sour, it was unknown if craft beer sales could continue to grow. But the allure of quality, independent and authentic beer continues to attract consumers, even in difficult economic times when almost everyone is looking at ways to trim spending.

According to The Nielsen Company, beer sales are affected the least by the economic downturn, with wine sales showing the most impact. Additionally, craft beer is gaining customers from across all segments of beverage alcohol.

“Newer brands by the larger brewers, like Belgian style wheat beers, have huge distribution advantages over beers by independent craft brewers,” said Paul Gatza, Director of the Brewers Association. “These brands can grow when the large brewers decide they want them to grow with the ability to impact what brands get shelf space and tap handles. At the same time, beer from craft brewers is being requested by the customer, which encourages distributors and retailers to make the beer available.” According to the Brewers Association, 1,420 of the 1,463 U.S. breweries are independent craft brewers.

The Brewers Association reports that in the first half of 2008 volume of beer sold by craft brewers grew by 6.5% totaling an estimated 4 million barrels of beer compared to 3.768 million barrels sold in the first half of 2007. Harry Schuhmacher of Beer Business Daily stated, “Crafts have really taken pricing this year given high input costs, and yet it is still driving volume gains faster than the beer category.”