USA, OR: Deschutes Brewery among US top five craft brewers

Bend, Oregon-based Deschutes Brewery has entered the ranks of the nation’s top five craft brewers, despite being available in just 19 states, Shanken News Daily reported on July, 26.

A recent brewery expansion at company headquarters should enable Deschutes to meet strong demand in existing markets while it maps longer-term plans to establish a more national footprint.

Deschutes, launched 24 years ago by Gary Fish as a brewpub, sold 223,000 barrels of beer last year, making it the fifth-largest craft brewer in the U.S. market. Despite its success, Deschutes tends to be overlooked by East Coast industry observers because its brands aren’t distributed there.

Fish said that the 100,000 barrels of new capacity that went online in late spring will help meet demand in current markets - and that there are no immediate plans to enter other states. “We’d like for our beers to be in all 50 states, but we’re very conscious of not over-committing,” he says. A second brewery expansion phase should start in 2014 and ultimately push capacity to around 600,000 barrels.

In terms of longer-term expansion to the East Coast, Fish says another brewery location will be needed for such a move. Among the solutions he foresees are building a second brewery, utilizing capacity that already exists within the industry, or “another model that could create brewing capacity closer to where we’re selling it.”

For this year, Deschutes is projecting strong double-digit growth, led by top-selling labels Mirror Pond Pale Ale, Black Butte Porter and Inversion IPA, all retailing at $8.49-$8.99 a six-pack. The Deschutes Reserve series of beers, including The Abyss and The Dissident, with suggested pricing of $11.99 a 22-ounce bottle, is coveted by beer connoisseurs, while Chainbreaker White IPA, released in the Northwest earlier this year, is performing strongly, Fish says. “We can’t keep Chainbreaker White on store shelves at this point,” he adds, noting that “eventually it will get to all of our markets.” According to Deschutes COO Michael LaLonde, the low-alcohol Flagline Golden Ale - with an abv of just under 4% - will launch some time this quarter. “We think there’s a tremendous amount of opportunity to release new styles,” LaLonde says. “Consumers seem to like where we’re going.”

27 July, 2012