Craft growth: Steady as she flows

Source: Brewers Association

Craft beer continued to show smaller but steady gains last year while the overall market shrunk slightly, according to a new report from the Brewers Association.

The industry trade group says total craft production rose by 5 percent. That follows a 6 percent increase in 2016, which was the first time since 2009 that the growth rate had dropped below 10 percent.

As a result, craft accounted for 12.7 percent of the U.S. beer market last year, up from 12.1 percent the previous two years. While craft continued to rise, overall beer production dropped by 1 percent.

Three-fourths of craft growth came from microbreweries (producing fewer than 15,000 barrels per year) and brewpubs, as opposed to larger regional and national brewers who ship their beer farther from home. Bigger players like Boston Beer (Sam Adams) and Sierra Nevada saw decreased sales last year.

“Beer lovers are trending toward supporting their local small and independent community craft breweries,” Bart Watson, the Brewers Association’s chief economist, said in a press release.

“At the same time, as distribution channels experience increased competition and challenges, craft brewer performance was more mixed than in recent years, with those relying on the broadest distribution facing the most pressure.”

There were 6,266 operating craft breweries at year’s end, up from 5,424 in 2016 and more than twice the total from five years ago.

But brewery closures are ticking up slightly, though the overall percentage remains small. There were 997 brewery openings and 165 closures last year, compared to 826 openings and only 97 closures in 2016.