E-Malt.com News article: Australia: Craft beer sales up by 48% in 2011-2013

Australians are continuing to turn away from beer. Sales as a proportion of all alcohol sold decreased to 41 per cent last year, compared to 75 per cent in the early sixties, News.com. au reported on October 16.

While the big players may not yet be drowning their sorrows, with craft estimated to be only about 2.5 to 3 per cent of the total Australian beer market in volume terms, sales of the boutique variety, admittedly off a low base, grew by 48 per cent in 2011-2013.

The same trend has already been witnessed in the United States, where sales were up 17.2 per cent last year as total beer sales fell two per cent.

Joel Connolly, from Sydney Craft Beer Week, says the Australian industry is in its infancy compared to the US.

A decade ago, people didn't care so much about where their beer came from, Mr Connolly says.

"It had nothing to do with the flavour of the beer. Now people are starting to switch that up and they are starting to care about quality and flavour, and how it's produced."

"Overall people are drinking less beer.

"But craft is made in a much different way to regular beer. We're definitely seeing that while the overall market is shrinking, craft is just going crazy."

The global beer industry, worth about A$170 billion a year, is ruled by just a couple of companies including Anheuser-Busch InBev, which owns the likes of Corona and Beck's, and SABMiller which has Victoria Bitter and other Foster's labels on its shelf.

Such marker dominance can mean less choice for consumers, and higher prices. The landscape is much the same in Australia.

Industry insiders say this market dominance gives bigger players the power to encourage or induce bars and bottle shops into not carrying the boutique brands.

Mr Connolly has heard stories of big brewers saying to the smaller bars and bigger pubs: "'if you want our beers on tap, you can't have craft on tap, or you're only allowed to have one tap out of say 15 dedicated to craft and the rest has to be our beer'."

"Obviously they're looking at the trends and they're seeing a big decline in beer sales and rise in craft," he said.

"It can be really difficult for craft brewers to get their beers inside a major national chain, and even if you do it's a struggle to get good shelf space because the bigger brewers have more negotiating power."

The Craft Beer Industry Association argues it needs tax reform to assist industry growth.

It has established a committee to lobby the government on excise reform, and in particular wants a volume-based tax rather than one based on alcohol content.


16 October, 2014