• Legal Marijuana Could Provide a Buzz to Beer

    Pot

    © Steve Dipaola/Reuters The legalization of medical marijuana has helped beer sales, contrary to previous research that pointed to a decline, according to a note from Sanford C. Bernstein analyst Trevor Stirling. Recreational pot use in Colorado and Washington, the two states where it’s legal, has so far not had a “significant impact” on beer, he said.

    Beer has no need to fear weed.

    The legalization of medical marijuana has helped beer sales, contrary to previous research that pointed to a decline, according to a note from Sanford C. Bernstein analyst Trevor Stirling. Recreational pot use in Colorado and Washington, the two states where it’s legal, has so far not had a “significant impact” on beer, he said.

    “The average blue-collar Bud drinker is less likely to be smoking pot,” Stirling said. “As far as medical marijuana is concerned, it does not appear to be a big threat to the beer industry.”

    The research could relieve one concern for beermakers Anheuser-Busch InBev NV and SABMiller Plc, which have seen U.S. volume decline over the past five years due to high unemployment and a shift to spirits like bourbon and gin. Twenty-three states have allowed medical marijuana and about a dozen, from Florida to Alaska, are considering legalization in some form.

    Per-capita beer drinking had a one-time increase of about 0.5 percent in the 10 largest states that have legalized medical marijuana, the Bernstein analyst found. While beer consumption later declined in those states, the rate of decline slowed to become more in line with the national average.

    More Beer

    “There may be a ’constrained budget’ effect for some consumers, but legalized recreational weed is likely to lead to lower prices in the long term, potentially freeing up more cash either for more weed or more beer,” Stirling said.

    Bernstein’s research contrasts with an October 2012 study by professors at Montana State University, the University of Oregon and the University of Colorado Denver. It found that alcohol sales declined about 5 percent in states that legalized medical marijuana, “suggesting that marijuana and alcohol are substitutes,” especially among young adults, the authors said.

    States that have legalized weed in some form including Colorado also have the highest rates of craft beer production, Stirling said, and some craft brewers have “whole-heartedly embraced the weed counter-culture.” One brewer, Oskar Blues Brewing Co. of North Carolina, indicates on some of its beer cans where they might be punctured in order to turn the can into a bong for smoking cannabis.

    A Pew Research center survey published in April shows 75 percent of the population thinks marijuana’s sale and use will eventually be legal nationwide. Legalized weed could also be a boon for restaurant chains including Chipotle Mexican Grill Inc., Dominos’s Pizza Inc., and Yum! Brands Inc., Bernstein said.

    Source: http://www.msn.com

  • German Beer Goes American to Regain Buzz in Oktoberfest Home

    octoberfestIn Germany, home of Oktoberfest and a five-century-old brewing law, beer consumption has been on an unstoppable decline, prompting Europe’s biggest producer of the beverage to turn to an unlikely place for help: the U.S.

    Oliver Lemke has been making trips to Colorado, New York and California, learning how craft brewers grabbed a sizable portion of the U.S. market. Lemke, who says his American counterparts have taught him to be bolder and experiment with new categories, is now expanding his Berlin brewery as the trend reaches Germany, where the number of micro breweries has increased by more than 30 percent since 2005 to about 670.

    “We Germans were convinced we’re making the world’s best beer but meanwhile, beer diversity suffered,” Lemke said while sipping his newest creation, an India Pale Ale with a hint of grapefruit and mango. “Craft brewing is a lucrative and interesting niche and it was a mistake not to do it earlier.”

    Germany, home to the world’s oldest active brewery started by Bavarian monks a thousand years ago, is synonymous with beer and the country’s 8 billion-euro ($10 billion) industry. Yet consumption and output in Germany — which has beer gardens in cities such as Munich that can seat 8,000, and more than 1,300 breweries — has declined for the past seven years.

    Instead, Germans are sipping more wine, Italian-style coffee drinks and summer cocktails such as Aperol Spritz, made with red liquor produced by Davide Campari-Milano SpA. The latest hit is a drink called Hugo, mixed from sparkling wine, seltzer and elderberry syrup and topped with mint leaves.

    U.S. Boom

    In response, German breweries are looking to put the buzz back in beer by following the lead of the U.S., where Boston Beer Co Inc, which sells the Samuel Adams brand, was one of the instigators of a craft beer boom that started in the late 1970s and picked up steam in the past five years.

    Craft brewers accounted for 14 percent of the $100 billion U.S. market last year, according to the Brewers Association, an industry group based in Boulder, Colorado. While U.S. beer sales fell 1.9 percent last year, domestic craft beer sales grew 17 percent, the group said.

    In Germany, craft beers have been long absent from the market that’s dominated by pilseners — until now.

    “Craft beers are a new trend in Germany that is growing rapidly,” said Elisabeth Meyer-Renschhausen, a sociology professor at Berlin’s Free University who specializes in the history of eating and drinking. “It’s highly popular especially with young urban consumers who value the local footprint of these products.”

    Purity Law

    One reason Germany has been slow to embrace something that’s well-established elsewhere may be the country’s Reinheitsgebot, or “purity law,” drafted in 1516 and the oldest food law still enforced. To this day, a brewer can’t call his product beer if he doesn’t adhere to it.

    While foreign producers can add ingredients such as rice or sugar, Germans must make beer with just four items: malted barley, hops, water and yeast. Most craft brewers in Germany, including Lemke, produce their drinks after the purity law.

    With a wider choice of other beverages to buy, beer has lost some of its status. Former Berlin beer halls have been turned into upmarket cocktail bars, and even a construction worker toy by German brand Playmobil now has a pushcart with bricks and tools instead of the beer case he used to carry.

    The average German drinks about 107 liters (28.3 gallons) of beer a year, down from more than 140 liters in 1991, according to the Barth Group. That puts the country third in the world, after the Czech Republic and Austria. Americans drink about 75 liters a year.

    Changing Perceptions

    German brewers — who are currently celebrating Munich’s Oktoberfest, the industry’s highpoint of the year — are hoping specialty beers can help change perceptions and lure back buyers year round.

    Radeberger Gruppe AG, Germany’s largest producer, has begun selling craft beers with price tags that can reach 24.99 euros a bottle, such as the dark-brown 17th Anniversary Ale, a cuvee made of 7 different ales matured in oak. The Bayerische Staatsbrauerei Weihenstephan, the world’s oldest brewery started in 1040, now markets ‘Infinium,’ a beer developed in cooperation with Samuel Adams sold in a black champagne bottle.

    You can go even more individual than that. Holger Wirtz in May started Bierzuliebe, “beer to love,” a website where you can create your own beer — with your own preferences for hops intensity, alcohol level, liveliness and color — have it brewed and shipped to you in a champagne bottle within a week. You can also order Bierzuliebe’s house creations such as “Kehlenglueck,” or “Throat Joy,” for 9.95 euros.

    Micro Breweries

    “Beer has great untapped potential,” Wirtz said in an interview. “We want to make a premium product that people enjoy and celebrate instead of downing in a few gulps.”

    Gaining traction with craft beer may still be an uphill struggle. Micro breweries currently produce 1 percent of German output, according to the DBB, the German brewers’ association. While that may grow to as much as 3 percent, the craft beer boom won’t reach U.S. proportions because German consumers already get their beer, even if mostly pilseners, from small- and medium-sized breweries that often sell locally, said Stefan Huckemann, a Munich-based partner in the consumer business at consultancy Deloitte.

    “The craft beer trend comes from the U.S., which didn’t have the variety that markets like Germany and Belgium had for many years,” Huckemann said. “It’s nevertheless positive for the German market, which has been suffering from price pressure, as it will increase the perceived value of beer.”

    Lemke, who started making craft beer in 1999, is adopting a more American-style logo for his Berlin brewery, where he’s produced about 40 brews over the years. While Germany back then wasn’t ready for his pale ales and stouts, it is now, he said.

    “We waited 15 years for craft beer to take off,” he said. “It’s a trend I believe will stay around.”

    Source: http://www.msn.com/

  • Beer Pipeline To Be Built Under Historic Bruges

    map_of_belgium

    An underground beer pipeline is to be installed beneath Belgium’s medieval city of Bruges to dramatically cut the number of lorries clogging its cobbled streets.

     

    The 3km (1.86 mile) pipe linking the De Halve Maan brewery to a bottling plant will be capable of carrying 6,000 litres an hour.

     

    The pipeline, given the go-ahead by the city council, is set to take about 500 tankers off Bruges’ roads each year.

     

    Brewing has been carried out almost continuously on the current site for more than five centuries, and the firm wants to continue this tradition.

     

    While a new processing plant was opened on the Waggelwater industrial estate in 2010, every litre of the famous ‘Brugse Zot’ beer continues to be brewed at De Halve Maan on the Walplein.

     

    The pipes will be made from high-quality plastic – polyethylene – and will be primarily installed using advanced computer-guided drilling techniques – avoiding roadworks.

     

    The brewery’s CEO Xavier Vanneste told Belgium’s Het Nieuwsbladsaid: “The beer will take 10 to 15 minutes to reach the bottling plant.

     

    “By using the pipeline we will keep hundreds of lorries out of the city centre.

    “This is unique in the brewing industry with the exception of one German brewery that has installed a similar system.”

     

    The cost of the project has not been revealed, but the bill will be footed by the brewery, which welcomes up to 100,000 tourists each year.

     

    Bruges’ Alderman for Spatial Planning, Franky Demon, said: “In time, this innovative investment plan would reduce the amount of transport by heavy goods vehicles by 85%.

     

    “It is a win-win situation for everyone.

     

    “Moreover, the city has received a guarantee from the Halve Maan that all costs relating to the pipeline – both for installation and for any necessary repair works – will be met in full by the brewery.”

     

    Construction is expected to start next year.

    Source: http://news.sky.com/

  • Beer Prices At Every NFL Stadium During The 2014 Season

    The average cost for a small draft beer at NFL games this season is $7.53 according to data collected by Team Marketing Report from each team, up from $7.05 in 2013.

    The increase is despite the introduction of a $4.50 beer in St. Louis where the Rams now have the cheapest beer in the NFL. On the other hand, the fans of the Oakland Raiders and San Francisco 49ers must pay more than $10 for the cheapest beer at those games.

    Of course, the $4.50 beer at Rams games as well as the $5.00 beers in other NFL stadiums are at small sizes. If we consider the size of the beer, the most expensive beer is in Philadelphia where the smallest beer costs $0.71 per ounce. The Cincinnati Bengals offer the cheapest beer per ounce, with a 14-ounce beer costing just $5.00 ($0.36 per ounce).

    NFL Beer Prices
  • Russian Downturn Hits Europe’s Beer Makers

    P

     

    Russia‘s drift toward recession has slashed Carlsberg‘s sales in the country, while fellow brewer Heineken escaped the worst thanks to its smaller exposure to eastern Europe.

     

    Carlsberg’s dependence on Russia, where its Baltika label is the most popular beer brand by far, makes it a test case for how European companies are coping with the chill in Moscow’s relations with the European Union caused by the conflict in Ukraine.

     

    Sanctions have dented confidence in an already slowing economy and taken a toll on the rouble currency – a blow for European companies that invested heavily to tap Russia’s emerging middle class.

     

    One brokerage said last week that Carlsberg was becoming “uninvestable” because the sanctions had tarnished its status as a stable consumer-goods investment play. ( http://bit.ly/1w8n02o )

     

    On Wednesday, the company cut its 2014 profit guidance and said its Russian beer sales tumbled by one fifth in the second quarter. The 167-year-old Danish brewer relies on Russia for more than a third of its operating profits.

     

    Finance chief Jorn Jensen said the Russian downturn had been even worse than expected. Carlsberg cut its guidance for the second time this year and now sees annual operating profit going into reverse. It may even close breweries in eastern Europe.

     

    Carlsberg shares fell as much as 6 percent.

     

    “They are already downgrading now and not waiting for more clarity – it shows they believe the second half will be very tough in Russia,” said analyst Michael Friis Jorgensen from Alm. Brand Bank, who has a “neutral” rating on Carlsberg shares.

     

    HEINEKEN LESS EXPOSED

     

    Heineken said its sales volume in Russia fell by a “low-double digit” percentage, without being more specific. But its shares leaped by more than 7 percent as overall quarterly earnings beat expectations.

     

    “We are a very diversified company so this is where our large footprint saves us. We don’t depend on Russia and the exposure is not a problem,” Heineken Chief Executive Jean-Francois van Boxmeer told a conference call.

     

    Heineken’s central and eastern European business contributed just 8 percent to operating profit. The Amsterdam-listed brewer makes Europe‘s best-selling Heineken lager as well as Sol and Tiger and Strongbow cider.

     

    Carlsberg has barely a toehold in the Americas and Middle East and Africa – regions that accounted for about a quarter of Heineken’s sales by volume in 2013, according to consumer market researcher Euromonitor International.

     

    “(Heineken) has made acquisitions such as FEMSA in Mexico and they’ve taken full control of Asia Pacific Breweries in Southeast Asia,” said KBC Securities analyst Wim Hoste said.

     

    “All of that has helped to give Heineken an international character and means that unlike Carlsberg they’re not dependent on one single market.”

     

    NOT “UNINVESTABLE”

     

    Carlsberg’s Baltika breweries were established just as the Soviet Union collapsed. After privatization, its beers such as the 8 percent-strong Baltika 9 brand spread rapidly through Russian-speaking regions. Carlsberg bought the company in 2008.

     

    It is one of several European companies blaming Russia for a weaker performance in the second quarter – though most have pointed more to the effect of the weaker rouble on repatriated revenue than a decline in business in the country.

     

    Adidas , the world’s number-two sportswear firm, said last month it was reining in investment in Russia, where it runs more than 1,000 stores, and cut its profit target due to the ruble’s fall and increasing risks to Russian consumer sentiment.

     

    “These European companies exposed to Russia have not become ‘uninvestable’, but there is a pressure on earnings,” said Antonin Jullier, Global Head of Equity Trading Strategy at Citi.

     

    “Given that we are in a phase of the cycle that looks at earnings momentum, that’s why these stocks are going through a re-rating.”

     

    Adidas shares have fallen 35 percent this year, while Carlsberg is now down 13 percent, compared to a 2 percent increase in the pan-European FTSEurofirst 300 index .

     

    Investors do not appear to be dumping European equities across the board because of Russia.

     

    Caroline Vincent, a fund manager at Cavendish Asset Management, said Russian sanctions could cause short-term volatility on stocks like Adidas but would not necessarily alter their underlying, long-term business trends.

     

    “I would be mindful of Russian sanctions on Europe when investing, as opposed to out-and-out avoiding certain European companies exposed to them,” she said.

     

    Despite the Russian problems, Carlsberg said operating profit rose 6 percent to 3.6 billion Danish crowns in the second quarter, higher than the 3.43 billion profit consensus analyst forecast in a Reuters poll.

     

    Heineken’s operating profit before one-time items grew 9.6 percent in the first half of the year to 1.454 billion euros ($1.93 billion), above the 1.367 billion poll consensus.

     

    Heineken said it saw slowing growth in the second half but that profit margin growth would be greater than forecast and it had already exceeded a target for cost savings.

     

    (1 US dollar = 5.6031 Danish crown)

     

    Source: http://money.msn.com/

  • America’s First Strip Club Brewpub

    PintsAndPinups

    Looking for a more adult adult focus brewery and bar?  Look no further than Pints & Pinups Medway, OH.

     

    It started as a bizarre phone call from my editor: “We need to push back your column by a week, but we have another story for you,” she explained. “It’s for our annual Sex Issue.” Pause. “Apparently, there’s a gentleman’s club that is now brewing its own beer. We need you to go investigate.”

     

    A microbrewing topless bar? Who gets assignments like this?

     

    The club in question is Pinups and Pints. Attuned to Dayton’s brewing scene, I was surprised I hadn’t heard of it. I was skeptical; so, I began my research.

     

    The club is in Medway, just north of where I-675 dead-ends into I-70. I had never been to Medway, but it struck me as a sleepy little farm town just outside the ’burbs. My thoughts about strip clubs in tiny farm towns were not kind, but I tried to keep an open mind.

     

    So, I dug deeper. Turns out, there are whole sites devoted to rating strip clubs. Think Yelp for nudie clubs. While I couldn’t find Pinups and Pints, I could find a club at the same address – Baby Dolls. I will spare the reader quotes from the somewhat incomprehensible – and almost always misogynistic – reviews, but suffice it to say, the reviews weren’t good.

     

    At a bit of a loss as to how to cover this story, I called my editor. She recommended I talk to the publisher. When I got him on the phone, he offered some direction. Go in and meet the owner, get a feel for the place.

     

    “Go have a good time. Find out about their beer, interview some of the entertainers.”

     

    “This is going to be a shit show, isn’t it?” I asked.

     

    “Go into it with an open mind,” he chided. “You might be surprised.”

     

    My publisher gave me the number for Scott Conrad, the club’s owner. I called Conrad, who was more than happy to oblige, and arranged a visit for me to come with a few friends that Saturday.

     

    So, four of us, including me, a fellow beer geek, a local brewer and the owner of a local beer-forward establishment, trekked to Medway, all expecting the worst.

     

    “Wouldn’t it be weird,” one of us remarked, “if we got to the club and it was nice inside? Weirder still, if the beer was good and the entertainers were actually, well, entertaining?”

     

    And that might be the weirdest part of the whole story.

     

    When we pulled up, we were immediately surprised by the façade. The lighting was high-end, and the club looked out of place, like it belonged in some bigger, booming town. Inside, the surprises continued. The décor was tasteful and modern. Clearly, it had been recently updated with big, comfortable chairs and ambient lighting. The stage, with its requisite pole and mirrors, was tastefully subdued.

     

    Conrad greeted us inside. He owns Pinups and Pints and is one of the partners behind Diamonds Cabaret, the regionally-famous club in Centerville, as well as Vue Ultra Lounge and Club Masque. We went to the back room, which was where the brewery was housed. The brewery is a small affair – only a 15-gallon set-up, but a SABCO high-end computerized system that homebrewers would certainly kill for.

     

    Conrad confessed he hadn’t been an avid homebrewer, but the idea of making his own beer appealed to him. It also helped to renovate the club. Baby Dolls didn’t have a liquor license, and to get a license through the regional agencies can be tough. However, a brewer’s license is easier to obtain. Pinups and Pints’ type of license is the same one Fifth Street Brewpub, Lock 27 and several other local breweries hold. It allows them to not only brew and serve their own beer, but also to serve a full bar of guest beers, liquor and wine.

     

    Pinup Pale Ale, Conrad’s inaugural beer, was being primed for release that Monday, but we sampled an early release. It was a solid pale ale, a good start on a new system and one that will get better as Conrad works out the kinks in his system. “If I’m going to have it, I might as well make it good,” Conrad explained. He plans to do an Oktoberfest as well, offering two beer styles alongside the full bar.

     

    When asked about the impact the craft beer is having on business, Conrad noted, “It’s been great. We’ve been having people come out for the beer.” Alisha, the bartender and part-time dancer, noted a similar occurrence: “People are interested in the beer. It’s fun to have more to offer.”

     

    Overall, we had a great time. What we expected was light years away from what we experienced. With high-quality décor, attractive and enthusiastic entertainers and a solid bar centered around microbrewed flagship offerings, Pinups and Pints seems to have figured out a formula to turn around a struggling gentlemen’s club into something with the possibility of being a regional destination, as well as perhaps the only microbrewing strip club in the country.

     

    Reach DCP freelance writer Kevin J. Gray at KevinGray@DaytonCityPaper.com

    It started as a bizarre phone call from my editor: “We need to push back your column by a week, but we have another story for you,” she explained. “It’s for our annual Sex Issue.” Pause. “Apparently, there’s a gentleman’s club that is now brewing its own beer. We need you to go investigate.”

    A microbrewing topless bar? Who gets assignments like this?

    The club in question is Pinups and Pints. Attuned to Dayton’s brewing scene, I was surprised I hadn’t heard of it. I was skeptical; so, I began my research.

    The club is in Medway, just north of where I-675 dead-ends into I-70. I had never been to Medway, but it struck me as a sleepy little farm town just outside the ’burbs. My thoughts about strip clubs in tiny farm towns were not kind, but I tried to keep an open mind.

    So, I dug deeper. Turns out, there are whole sites devoted to rating strip clubs. Think Yelp for nudie clubs. While I couldn’t find Pinups and Pints, I could find a club at the same address – Baby Dolls. I will spare the reader quotes from the somewhat incomprehensible – and almost always misogynistic – reviews, but suffice it to say, the reviews weren’t good.

    At a bit of a loss as to how to cover this story, I called my editor. She recommended I talk to the publisher. When I got him on the phone, he offered some direction. Go in and meet the owner, get a feel for the place.

    “Go have a good time. Find out about their beer, interview some of the entertainers.”

    “This is going to be a shit show, isn’t it?” I asked.

    “Go into it with an open mind,” he chided. “You might be surprised.”

    My publisher gave me the number for Scott Conrad, the club’s owner. I called Conrad, who was more than happy to oblige, and arranged a visit for me to come with a few friends that Saturday.

    So, four of us, including me, a fellow beer geek, a local brewer and the owner of a local beer-forward establishment, trekked to Medway, all expecting the worst.

    “Wouldn’t it be weird,” one of us remarked, “if we got to the club and it was nice inside? Weirder still, if the beer was good and the entertainers were actually, well, entertaining?”

    And that might be the weirdest part of the whole story.

    When we pulled up, we were immediately surprised by the façade. The lighting was high-end, and the club looked out of place, like it belonged in some bigger, booming town. Inside, the surprises continued. The décor was tasteful and modern. Clearly, it had been recently updated with big, comfortable chairs and ambient lighting. The stage, with its requisite pole and mirrors, was tastefully subdued.

    Conrad greeted us inside. He owns Pinups and Pints and is one of the partners behind Diamonds Cabaret, the regionally-famous club in Centerville, as well as Vue Ultra Lounge and Club Masque. We went to the back room, which was where the brewery was housed. The brewery is a small affair – only a 15-gallon set-up, but a SABCO high-end computerized system that homebrewers would certainly kill for.

    Conrad confessed he hadn’t been an avid homebrewer, but the idea of making his own beer appealed to him. It also helped to renovate the club. Baby Dolls didn’t have a liquor license, and to get a license through the regional agencies can be tough. However, a brewer’s license is easier to obtain. Pinups and Pints’ type of license is the same one Fifth Street Brewpub, Lock 27 and several other local breweries hold. It allows them to not only brew and serve their own beer, but also to serve a full bar of guest beers, liquor and wine.

    Pinup Pale Ale, Conrad’s inaugural beer, was being primed for release that Monday, but we sampled an early release. It was a solid pale ale, a good start on a new system and one that will get better as Conrad works out the kinks in his system. “If I’m going to have it, I might as well make it good,” Conrad explained. He plans to do an Oktoberfest as well, offering two beer styles alongside the full bar.

    When asked about the impact the craft beer is having on business, Conrad noted, “It’s been great. We’ve been having people come out for the beer.” Alisha, the bartender and part-time dancer, noted a similar occurrence: “People are interested in the beer. It’s fun to have more to offer.”

    Overall, we had a great time. What we expected was light years away from what we experienced. With high-quality décor, attractive and enthusiastic entertainers and a solid bar centered around microbrewed flagship offerings, Pinups and Pints seems to have figured out a formula to turn around a struggling gentlemen’s club into something with the possibility of being a regional destination, as well as perhaps the only microbrewing strip club in the country.

    Reach DCP freelance writer Kevin J. Gray at KevinGray@DaytonCityPaper.com

    – See more at: http://www.daytoncitypaper.com/the-blonde-and-the-bubbly/#sthash.qOJ851jp.dpuf

    Source: http://www.daytoncitypaper.com/

  • Anheuser-Busch Targets Latinos with New Mexican Beer Import

    No Anheuser-Busch

    Anheuser-Busch is wedging its way back into the Mexican beer market. The beer giant is importing its first Mexican lager to select Southwestern states to target Latino consumers. First stop: Dodger Stadium.

     

    The beer giant, a division of Anheuser-Busch InBev of Belgium, announced Wednesday that Montejo beer will be available in bars, restaurants and grocery stores in California, Texas, Arizona and New Mexico, where 70% of America’s Latino population lives.

     

    Anheuser-Busch said Mexican beers account for nearly 60% of imports, highlighting a growing demand for Latin products. Mexican beer imports grew twice as quickly as total beer imports, according to a report by IbisWorld, a market research firm.

     

    This isn’t Anheuser-Busch’s first forray into Mexican beers. The beer maker agreed to sell its U.S. rights to distribute Corona and Modelo last year as part of an antitrust agreement with the Justice Department before it could go ahead with its $20.1-billion takeover of Grupo Modelo of Mexico.

     

    Reluctant to let go of the booming market, Anheuser-Busch decided to import Montejo in February because of increased demand, said Ryan Garcia, vice president of regional marketing.

     

    “We’ve been watching this market for a while, and the consumer demand is huge,” said Garcia, explaining that the beer will be marketed in Latino radio, digital, print and restaurant industries.

     

    Americans are clamoring for more imported beer in general. Nearly 43% of U.S. consumers drank imported beer last year, according to a report by research firm Mintel, but Mexican brands lead the pack in terms of affordability, popularity and successful marketing strategies — think Dos Equis and its “the Most Interesting Man in the World” campaign.

     

    “Contrary to popular belief, the fastest-growing beers in the U.S. right now are not craft beers, but Mexican imports,” said Harry Schuhmacher, publisher of trade journal Beer Business Daily. “Anheuser-Busch would be foolish not to attempt to tap into that growth.”

     

    But the market is already cramped. Mexican brands make up 8% of overall U.S. beer volume, and experts expect that to grow.

     

    Information Resources Inc., an industry research firm, reported that Corona Extra topped imported beers at more than $1.2 billion in sales last year in supermarkets, drugstores, mass merchandisers, gas and convenience stores.  Modelo Especial, a sister brand of Corona, had the highest growth in the imported beers segment in 2013 compared with the year before.

     

    Montejo is “a tough sell because the brand isn’t very well-known in Mexico,” Schuhmacher said.

     

    Garcia said Anheuser-Busch targeted Los Angeles for its campaign launch because the city is home to 9% of the nation’s Latino population. The beer will first be sold at Dodger Stadium on Aug. 15 before its full release in September, the first time Anheuser-Busch has launched a beer exclusively with a sports franchise before making it available at retailers.

     

    “We’ve partnered with the Dodgers and are converting the Bud Light bar in right field to a Montejo bar,” Garcia said. The company is also bringing in a brew master from Mexico to head the bar.

     

    The Dodger launch will also be the first time Montejo, founded in 1960, will be sipped outside Mexico.

    Source: http://www.latimes.com/

  • Will InBev Buy SABMiller?

    No Anheuser-Busch

    InBev’s $52 billion purchase of Anheuser-Busch Cos., announced six years ago this weekend, remains the biggest deal in beer history.

     

    But there’s another merger of brewers that could eclipse it.

     

    A number of industry analysts say they have reason to believe that A-B InBev could be preparing another blockbuster purchase by acquiring rival SABMiller, the world’s No. 2 beer company.

     

    Rumors of a tie-up between Belgium-based A-B InBev, already the world’s largest brewer, and London-based SABMiller have been around for years, but talk of a deal between the two is heating up.

     

    “I think that we’ve come to a break point, a decision point,” said Tom Pirko, president of Bevmark, a food and beverage industry consulting firm in Buellton, Calif. “I think that we’re close now.”

     

    Speculation was already brewing when the Financial Times, or FT, Britain’s equivalent of the Wall Street Journal, reported in early June that traders believed bankers were working to raise $60 billion in debt to fund some kind of European takeover, and that SABMiller was a possible target.

     

    “The chatter has intensified,” said Harry Schuhmacher, publisher of Beer Business Daily, a trade publication.

     

    He noted that the FT broke the news six years ago about InBev’s takeover plans for A-B. Though the newspaper has yet to write a story confirming that a deal is indeed in the works, Schuhmacher drew parallels between the 2008 sale and the current flurry of speculation.

     

    “It’s like ‘Groundhog Day’,” he said. “When there’s smoke, there’s usually fire.”

     

    Robert Ottenstein, a senior managing director at New York-based research firm ISI and head of its global beverages team, believes a combination between the makers of Budweiser and Miller Lite could happen this year or 2015.

     

    “More than at any point in the last 10 years, SABMiller appears ripe for a combination with ABI,” Ottenstein wrote in a May research note, adding A-B InBev has digested its 2013 $20.1 billion acquisition of Mexican brewer Grupo Modelo, with most cost-savings expected to be realized by the end of this year.

     

    For Ottenstein, a former investment banker who headed investor relations for A-B InBev after A-B’s sale, the deal is compelling.

     

    A combination of the two companies would bring together eight of the 10 leading global beer brands: A-B InBev’s Bud Light, Budweiser, Corona Extra, Skol, Stella Artois, and Brahma; and SABMiller’s Aguila and Miller Lite.

     

    The only top-10 global beers not under their control are Heineken and Guinness.

     

    Combined, A-B InBev and SABMiller would account for about $65 billion in sales and nearly 30 percent of global beer volume.

     

    Ottenstein contends A-B InBev’s strong global brands would pair well with SABMiller’s extensive global footprint. A-B InBev has invested heavily in building flagship Budweiser’s sales globally following its purchase of A-B, he pointed out in the May report.

     

    In 2010, Budweiser grew its global sales volume by 1.7 percent, even as its U.S. sales declined. Budweiser has continued its sales momentum globally, increasing volume by 6.3 percent in 2013, with sales in China, Brazil and Russia, among other major markets.

     

    Meanwhile, SABMiller’s market position is strong in regions with high growth potential, including Africa and China.

     

    “The potential to introduce (A-B InBev’s) global brands to SABMiller’s regions extends their growth and margin potential,” according to Ottenstein’s report.

     

    Additionally, A-B InBev could reap $2 billion in cost-savings through an acquisition of their largest rival, through global procurement and shared services, and eliminating job redundancies, he wrote.

     

    Successfully implementing those kinds of cost-saving measures is what A-B InBev Chief Executive Carlos Brito and his management team are known for.

     

    “They’re not great brand builders, but they’re the smartest bankers in the world,” said beer industry consultant David “Bump” Williams, chief executive and president of Stratford, Conn.-based Bump Williams Consulting. “No matter what they buy, they find ways to eliminate waste and reductions.”

     

    Growing through acquisitions is in A-B InBev’s DNA. The deal to buy Anheuser-Busch came just four years after Belgium’s Interbrew and Brazil’s Ambev combined to create InBev. Last year, A-B InBev bought the rest of Grupo Modelo, maker of Corona and other beers, that it didn’t already own for $20.1 billion. And this year, it acquired the leading brewer in South Korea, Oriental Brewery, for $5.8 billion.

     

    SABMiller’s strength in Africa, China and other countries where InBev wants to grow makes it an attractive combination, Williams said.

     

    “I think SABMiller is their number one target,” he said. “InBev wants to be the global, dominant player in beer, and this would help them do that.”

     

    ROADBLOCKS

    A combination of the two beer giants would be closely watched on Pestalozzi Street, where A-B InBev’s North American operations are based. The 2008 deal made some A-B executives and shareholders very wealthy, but it also resulted in job losses. What impact a deal with SABMiller would have in St. Louis is unclear, but many analysts say it would be minimal as SABMiller would likely have to divest its U.S. operations to satisfy antitrust concerns.

     

    If a megasized deal is in the works, many roadblocks would stand in the way, including the high price SABMiller would command and antitrust battles domestically and overseas.

     

    Some analysts are speculating SABMiller could make a defensive move and partner instead with London-based Diageo, maker of Smirnoff, Guinness and Baileys, to stave off a hostile bid. A-B had considered a similar move with Grupo Modelo in 2008.

     

    “Logistically and strategically, the best pair-up would be A-B InBev and SABMiller,” said Morningstar equity analyst Philip Gorham. “I certainly think a big deal could be done. A-B InBev has the cash to do something. It should be SABMiller.”

     

    However, the high price it would take to acquire SABMiller makes the deal out of reach even to A-B InBev, Gorham said. “I don’t see how (A-B InBev) could create value at today’s price.”

     

    A-B InBev already has the largest market share in the United States, followed by Chicago-based MillerCoors, a joint venture created in 2007 by SABMiller and Molson Coors Brewing Co. to sell their beers in this country.

     

    A merger would likely require the sale of SABMiller’s stake in MillerCoors in the U.S. to another party to satisfy antitrust concerns, akin to what happened with Modelo. In a January interview with Bloomberg News, SABMiller CEO Alan Clark said a case could be made for a combination between SABMiller and A-B InBev, but it would likely require U.S. divestitures. “You could get the numbers to work,” Clark told Bloomberg. “There would be value loss and value destruction because they’d know that they’d have to sell the U.S. though.”

     

    In late June, Denver-based Molson Coors Brewing Co.’s Chief Executive Peter Swinburn wouldn’t rule out the possibility of his company acquiring MillerCoors in an interview with the Wall Street Journal. “The important thing for me is to put the company in position to take advantage of whatever comes our way,” Swinburn told the financial newspaper.

     

    The U.S. Justice Department sued to block A-B InBev’s purchase of the rest of Modelo in early 2013, arguing that the merger of the nation’s No. 1 and No. 3 biggest beer-sellers would be bad for beer-drinkers. The Justice Department relented only after a deal was struck for New York-based Constellation Brands to acquire the Grupo Modelo’s U.S. beer business from A-B InBev.

     

    Bevmark’s Pirko said Brito has a track record of looking beyond obstacles to make a deal come together.

     

    “There are antitrust issues galore here, but the way Brito thinks and acts, this is just the sort of ‘go for the gusto’ thing he likes,” Pirko said.

     

    Pirko also doesn’t agree that there’s a price too far out of reach for A-B InBev. “That’s the same thing we heard about the St. Louis deal,” he said. “This really is a workable deal.”

    Source: http://www.stltoday.com/

  • Thirst for US Craft Beer Grows Overseas

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    Helping to quench a growing thirst for American craft beer overseas, some of the United States’ largest craft breweries are setting up shop in Europe, challenging the very beers that inspired them on their home turfs.

     

    It’s the latest phenomenon in the flourishing craft beer industry, which got its start emulating the European brews that defined many of the beer styles we drink today. The move also marks a continuing departure from the status quo of mass market lagers or stouts, demonstrating a willingness of American breweries to explore — and innovate — old world beer styles from Belgium, Germany and the United Kingdom.

     

    The U.S. craft beer scene is so fresh and dynamic, Europeans are becoming as excited about it as Americans, says Mike Hinkley, co-founder of San Diego-based Green Flash Brewing Co. “Even though they’re used to all these amazing European beers, now there’s just more variety.”

     

    U.S. craft beer exports grew six-fold during the past five years, jumping from about 46,000 barrels in 2009 to more than 282,500 barrels in 2013, worth an estimated $73 million, according to the Brewers Association, the Colorado-based trade group for the majority of the 3,000 brewing companies in the United States. Of course, it’s still a fraction of overall production; U.S. craft brewers produced a total of 15.6 million barrels last year.

     

    Just last week, Green Flash became the first U.S. craft brewery to begin making and selling fresh beer in the European market under a deal with Brasserie St-Feuillien, a Belgian brewery founded in 1873. Under the watchful eye of Green Flash brewmaster Chuck Silva, the brewery is making and selling fresh West Coast IPA for distribution in the U.K., Belgium, France, the Netherlands and Italy.

     

    Meanwhile, 500 miles away in Berlin, Stone Brewing Co. is taking a different approach to meeting overseas demand — spending about $25 million to renovate a historic gas works building into a brewery, packaging and distribution center, restaurant and garden set to open late next year or early 2016. Escondido, California-based Stone — one of the top 10 biggest craft breweries in the U.S. — will make beer for its bistro and distribution throughout Germany and Europe.

     

    “The idea that we’re going to go across the pond as it were to brew our style of beers fresh in Europe is an exciting prospect for us,” said Stone CEO and co-founder Greg Koch, who announced the overseas expansion plans over the weekend. “When we started out at Stone 18 years ago, we were inspired by a lot of the European brewers … and now to see an inspiration bounce back around the world, that’s amazing.”

     

    Brooklyn Brewery’s brewmaster Garrett Oliver agreed, saying what used to be a one-way street in the beer world is coming full-circle: “The creative spirit and ideas that have been developing in the U.S. are flowing back in that direction. Now it’s a two-way street and we all have something to offer.”

     

    In the spring, New York’s Brooklyn Brewery and Carlsberg Sweden opened a craft brewery and restaurant making new beers that are being distributed throughout Scandinavia. The staff of Nya Carnegie in Stockholm was hired by Brooklyn Brewery and trained by its brewmaster. Brooklyn Brewery is still exporting its own beers to more than 20 countries in addition to its joint venture and also is looking at similar projects in other European capitals, South America and Asia. Around 30 percent of its business is exports.

     

    But the thirst for American craft beer hasn’t always been there.

     

    When the Brewers Association first gave presentations overseas about the American craft beer scene about 10 years ago, people would laugh aloud. They’d even quote a Monty Python skit comparing American beer to water.

     

    “They’re not laughing anymore,” said Bob Pease, chief operating officer for the U.S. beer trade group. “The word is out now that the highest quality beer, the most diverse beer, is coming from American craft brewers.”

    Source: http://money.msn.com/business-news/article.aspx?feed=AP&date=20140721&id=17791735

  • The U.S. Now Has More Than 3,000 Breweries

    3040breweries

     

    A few numbers illustrate the heady rise of beer in the United States. In 1983, there were only 80 breweries operating across the nation, the smallest count for at least 150 years. At the end of last year, that total had surged to 2,722 breweries.

     

    And this June, the number of operating U.S. breweries reached an astounding 3,040, with nearly 2,000 more in the planning phase. Let all of America’s beer drinkers now take a moment to lean forward and issue a joyful BRRAAAPPP over their favorite tipple’s meteoric success.

     

    These figures come from Bart Watson at the industry group Brewers Association, who alleges that today the “majority of Americans live within 10 miles of a local brewery.” Watson also says this is probably the first time (“probably” because the records are a little murky) that the brewery population has surpassed 3,000 since 1873, when the IRS logged 4,131. That’s not to say that the 1870s, rather than now, should be considered the boom-time for beer in the U.S. Part of the reason there were so many breweries back then was because they hadn’t streamlined the ways to make the process efficient, including refining refrigeration and automation.

    3000breweries

    Watson, who wins today’s award for best job title with “chief economist for the Brewers Association,” claims that despite some worries there is not a “beer bubble” about to burst in America. However, he does think that breweries should prepare for more intense competition and pay particular heed to the quality of their products. That last point is being echoed on the forums of Beer Advocate, where one person rails that new breweries need to “really step up their game and try to make really awesome (not just good) beer.” Watson elaborates:

     

    What it does not mean is that we’ve reached a saturation point. Most of the new entrants continue to be small and local, operating in neighborhoods or towns. What it means to be a brewery is shifting, back toward an era when breweries were largely local, and operated as a neighborhood bar or restaurant. How many neighborhoods in the country could still stand to gain from a high-quality brewpub or micro taproom? While a return to the per capita ratio of 1873 seems unlikely (that would mean more than 30,000 breweries), the resurgence of American brewing is far from over.

     

    In support of this argument is the fact that the largest slice of America’s beer pie (recipe to come) is local, smaller-scaled operations. Out of the 2,722 U.S. breweries in operation at the end of 2013, a full 1,376 were microbreweries and 1,202 were brewpubs.

     

    What will the country’s sudscape look like a few years from now? Watson says to expect big beer-production growth rates in North Dakota, Alabama, and West Virginia. That’s because these states, along with a few others, are “growing off small bases, and so even if they aren’t adding the most new barrels in absolute terms, their percentage growth rates are still quite impressive.”

    Source: http://www.citylab.com/

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