USA, AR: Arkansas beer production continues to climb

Arkansas' beer production continues to climb, with the amount of beer made in the Natural State hitting record numbers once again for 2022 while the nation's craft industry saw growth slow, The Arkansas Democrat-Gazette reported on November 26.

According to figures provided by the Alcoholic Beverage Control Division of the Arkansas Department of Finance and Administration, Arkansas breweries produced 52,840 barrels of beer and hard seltzer products last year, up from 46,440 barrels of beer produced in 2021. That's an increase of just shy of 14% year-over-year over 2021's record year.

When converted to gallons, the state's brewers produced 1.64 million gallons of beer in 2022 compared to 1.44 million gallons for the year prior period. A barrel of beer contains 31 gallons.

"These numbers are really phenomenal for the craft beer market," Lacie Bray, co-founder of Ozark Beer Company in Rogers and president of the Arkansas Brewers Guild, said in a recent interview.

She noted nationally craft brewers have been facing inflationary pressures and production has been flat. In Arkansas, she said, brewers faced challenges in 2022 and into 2023 but beer makers in the Natural State overall seem to be faring well.

That said, she noted supply issues and climate concerns have made it difficult to acquire malt and hops. Inflation is affecting local brewers as well, making their product more costly to produce -- particularly in packaging expenses -- from cans, cardboard and even labels. She said costs have forced some breweries to raise their prices to try to cope.

"But those increases don't cover what costs many have had to absorb over the year," Bray said.

Nationally in 2022, overall beer production was down 3.1% to 182.1 million barrels while craft beer, which made up 13.2% of the market, was virtually unchanged, up 0.1% to 24.3 million barrels.

Bart Watson, chief economist for the Brewers Association, a trade group for craft brewers from across the United States, said Arkansas brewers did quite well compared to their peers around the country, showing strong and sustainable growth.

He added production doesn't always mean profits and echoed Bray's assertion that the cost of making beer rose significantly in 2022 and while many brewers did increase their prices, they likely didn't cover all rising input costs.

"Making more beer doesn't mean your making more money doing it," he explained.

He said nationally, many brewers are abandoning or no longer aspiring to, regional distribution plans and instead are focusing on their local customer base, serving them primarily in taprooms and through area bars and restaurants.

For 2023, Watson said craft beer production was down 2% to 4% at midyear and will likely be down at least that much -- if not a bit more -- for all of 2023. Citing data from the Beer Institute -- a trade organization representing the beer industry -- overall beer shipments (including both domestic and import) are down around 4% year-over year through September.

In 2022, Arkansas brewers working under Small Brewery production permits made 36,490 barrels of beer, up 17.6% compared to last year. In 2021, for the first time production of Springdale based Black Apple Cidery in Springdale was reported under its Small Brewery permit even though it produces strictly hard cider and no malt beverages. State beer production figures in this story for 2021 were adjusted to remove Black Apple's numbers to create an "apples to apples" comparison.

There were 49 active permits listed in the small brewery production category including Black Apple, according to the state. Two of those permits reported zero production in 2022.

Breweries operating under microbrewery restaurant permits brewed 16,350 barrels of beer, up nearly 6% from 15,424 for 2021. There were 14 active permits listed by the state in 2022, including microbrewery private clubs and two of those reported zero production for the period.

Little Rock-based Lost Forty handily kept its title of the state's largest beer maker in 2022. It operates under a microbrewery restaurant permit and made 15,666 barrels in 2022, up from nearly 5% from 14,939 the year earlier. The brewery is responsible for making nearly 30% of the state's total brew in 2022.

John Beachboard, a brewer and owner at Lost Forty, said the brewery faced increased costs in 2022, which resulted in a price increase to try to keep pace. Lost Forty also tried some new offerings, like putting its 2nd Rodeo light beer in 15- packs and selling them at the price of a 12-pack, to help its customers in their own battle against inflation.

For 2023, Beachboard said production has been up about 12%.

The state's second largest beer maker is Springdale-based Core Brewing and Distilling, which produced 8,435 barrels in 2022, down about 5% from 8,878 in 2021.

Jesse Core, founder of Core Brewing and Distilling said his operation is gearing up to post significant growth in 2023 and will be making a run at the state's top production spot. In addition to its other offerings, the company makes Sam's Club Members Mark Hard Seltzer that's now offered nationwide.

"We will do 20,000 barrels [in 2023] -- which is the most ever produced by an Arkansas brewery in a year," Core predicted.

Bentonville-based Bentonville Brewing Co. was Arkansas' third largest beer producer in 2022 at 5,460 barrels, up 54% from 3,524 barrels in 2021. Ozark Beer Co. ranked fourth with 5,412 barrels in 2022, up 33% from 4,069. North Little Rock-based Flyway produced 2,523 barrels, ranking fifth in 2022 and down slightly from 2,523 barrels in 2021.

27 November, 2023