With the rise of hard seltzer and other low-cal alcohol options, Americans seem to be drinking less beer, and U.S. producers are making less of it.
Overall U.S. beer volume sales were down 3% in 2020, while craft brewer volume sales declined 9%, lowering small and independent brewers’ share of the U.S. beer market by volume to 12.3%, according to the Brewers Association.
WHAT IS CONTRIBUTING TO THE DECLINE?
The Food Institute spoke to the Brewers Association to get insight into what is happening with American breweries.
“The biggest is the channel shift due to COVID,” said Bart Watson, Chief Economist at the Brewers Association. “Craft brewers sell a large percentage of their beer (~40%) either onsite or via distributed draught to bars/restaurants/other venues. We saw a huge shift in sales from bars/restaurants to grocery and other packaged stores in 2020, which hurt craft brewers much more than overall beer.”
Retail dollar sales of craft decreased 22% to $22.2 billion in 2020, and now account for just under 24% of the $94 billion U.S. beer market, according to the Association.
ARE THERE LESS BREWERIES TODAY?
Contrary to assumption, there are actually “more breweries than ever before in the United States,” said Watson. “We have seen consolidation over decades amongst the largest breweries, driven by global markets and consolidation, but the number of U.S. breweries is at an all-time high, and we are back to similar per capita levels as 125 years ago.”
As of 2020, regional breweries made up 65.8% of production volume, followed by microbreweries at 18.8% and taprooms at 7.9%. By count, there were 8,764 recorded craft breweries in the U.S., up from 8,391 in 2019—or 4.4.%.
Regional brewers were the only category to decline, although it was by just 20, going from 240 to 220. Interestingly, tap rooms grew nearly 10% from 2019, going from 3,159 to 3,471.
So, it doesn’t appear American beer manufacturing is going extinct any time soon.