E-Malt.com News article: USA: Craft brewers plan major expansions to help meet demand

Small craft brewers have defied the nation's stubborn economic slump, unable to meet growing demand despite a pullback by consumers overall, Philadelphia Inquirer reported on September, 25.

Several brewers in Pennsylvania and New Jersey are out to fix that supply problem by building new facilities, doubling and even tripling capacity to produce lagers and ales, and adding small numbers of jobs along the way.

Flying Fish Brewing Co. in Cherry Hill has paid $750,000 in deposits on equipment for a planned move to Somerdale that will triple its maximum capacity from the current 14,000 barrels a year.

Sly Fox Brewing Co. is planning to triple its current 10,000-barrel capacity when it moves from Royersford to Pottstown next year.

And last week, Tröegs Brewing Co., now in Harrisburg, was running tests at a new brewery in Hershey, Pa., that will double its capacity from 60,000 barrels, or 1.86 mln gallons, a year from 30,000 barrels right out of the gate.

Echoing other brewery managers, Gene Muller, who founded Flying Fish in 1996 and is majority owner, said: "We're beyond our capacity. We're maxed out."

In the first half of this year, sales of craft beer, made by the country's 1,740 small breweries, climbed 14 percent, compared with a 9 percent gain in the first six months of 2010, according to the Brewers Association.

"Things are definitely popping all over the country," said Paul Gatza, director of the association, whose Great American Beer Festival in Boulder starts on September, 29. More than 400 breweries, including a strong contingent from the Philadelphia region, are expected to compete for gold medals.

Over the last five years, sales of craft beer - defined as the production of brewers with capacity of less than 6 mln barrels per year - have climbed an average of 11 percent annually, Brewers Association data show.

By contrast, total domestic beer production was flat over the same period, according to the Beer Institute, a trade group in Washington.

Despite the gains by craft beer, it constituted just under 5 percent of total production last year. Big brewers such as the companies behind Budweiser, Miller, and Coors still account for about 82 percent of U.S. volume. Imports had a 13 percent market share last year.

Ironically, as craft-beer demand has grown, some of the brand sameness that predated the craft revival has begun to creep back, at least in Philadelphia.


28 September, 2011