Industry News (Issue 25)

Lagunitas Buys Stake in Three Regional Companies

The evolution of Lagunitas, from outspoken independent craft stalwart to its current role as an international player under the Heineken umbrella, will continue as news arrives that the company has purchased stakes in three strategically located regional breweries: Charleston’s Southend Brewery and Smokehouse, which will be rebranded as a Lagunitas brewpub, Santa Rosa, California-based Moonlight Brewing Co., a small Bay Area brewery verging on its 25th birthday, and Austin-based Independence Brewing.

Though details of the equity stakes weren’t released, they will all be held under a new LLC titled Lagunitas U.S. Holdings, or LUSH. Though Heineken now owns 50 percent of Lagunitas, founder Tony Magee has stated that these actions came independently from within Lagunitas, the sixth-largest craft brewer of 2015.

In addition, the company has announced it will open spaces in Portland and San Diego to be used exclusively for nonprofit fundraising. Lagunitas will provide the space, staff and beer for free, as it does in its Chicago and Petaluma taprooms.

Though some will inevitably cry foul, Magee cites the changes as necessary evolution of the ever-changing marketplace, and acknowledged the acquisitions by saying that “craft brewing has never been about anything but making relationships.” 

Magee went on to say that he plans to continue expansion into local breweries, and emphasizing that the deals are partnerships, rather than full-on takeovers.

Hilliard’s, Prairie Artisan Ales Sold

Over the past week, two small but popular craft breweries were sold to similarly sized beer companies.

Oklahoma’s Krebs Brewing, which produced around 8,000 barrels of its Choc Beer line last year, acquired Tulsa-based Prairie Artisan Ales, widely known for its Bomb! series. Unbeknownst to many, Krebs was already the contract brewer for Prairie, which put out around 2,000 barrels in 2015, and the deal has more or less been in place for the better part of a year.

“Since I already felt like the beers were a partnership it only made sense,” Krebs President Zach Prichard said of the acquisition. Prairie co-founder and head brewer Chase Healey will have “some involvement” in the future, though it seems the fate of Prairie is firmly in the hands of Healey and Krebs. According to a blog post by Prichard on Prairie’s website, this could mean new beers and new locations in the future.

“It is a humbling move that shows Chase continues to trust us to innovate, make great beer, and share Prairie across the globe,” said Prichard.

In another West Coast sale, Seattle native Hilliard’s Brewing has been sold to the smaller Odin Brewing, based out of Tukwila, Washington. Odin, which brewed around 3,000 barrels last year to Hilliard’s 4,700 barrels, will move “certain tanks and equipment” to its new Tukwila taproom and brewery, and aim to sell the remainder of Hilliard’s as an all-inclusive brewery package. 

Founder Ryan Hilliard will look to exit the craft beer business entirely. 

“I think the deal reached with Odin Brewing was a good one” Hilliard said in a press release. “It’s not often that deals like this come along, and when they do you have to be ready to move on them. I have enjoyed my time in the craft beer sector and am thrilled my namesake beer will live on in good hands.”

Odin Brewing Company was founded in 2009, and Hilliard’s was founded in 2011.

Most of Stolen Sweetwater Brew Recovered

We’ll start with the good news – Sweetwater Brewing Co. has recovered all but a few of the 3,272 cases (78,528 bottles) stolen from its brewery earlier this month, thanks to efforts by Georgia Bureau of Investigation’s Major Theft Unit and the Southeastern Transportation Security Council. The bad news? They’re all going to be destroyed.

“The product is being sent to Synergy Solutions Crisp County, a zero landfill, biofuel and waste recycling company,” Sweetwater said in an announcement. Though it seems like a lamentable end for the reunited suds, to Sweetwater, it’s a matter of maintaining quality. 

“We can no longer trust that that beer would be up to the quality standards that we as a brewery maintain, so unfortunately we have to destroy it all,” said Sweetwater marketing guru Steve Farace.

There’s still no word on whether or not the culprits, who stole two trailers containing the beers have been identified. 

Venezuelan Beer Shortage Leaves Drinkers Out in the Cold

Few things are more devastating than an empty beer fridge, and the collective fridge of Venezuela is getting dangerously close. 

Due to a barley shortage, Empresas Polar, a company which makes 80% of the country’s beer along with many other types of food, was forced to shutter all of its breweries in April. The reasons for the shortage are myriad, though restrictive foreign currency laws along with the country’s reliance on its oil industry over agriculture are central to the problem. 

While it should be noted that this concern pales in comparison to the overall food crisis the country is facing, the beer shortage has struck a chord with citizens on principle, with many expressing outrage. Venezuelan president Nicolás Maduro has attempted to deflect the anger with claims that Polar is deliberately halting production to disrupt the Venezuelan economy, though the government controls all imports and exports.

Empresas Polar’s executive president Lorenzo Mendoza responded: “We have been discussing how to reactivate our production of beer and malt and finally we found a temporary solution that will allow us to produce until the end of 2016.”

The temporary solution came in the form of a $35 million loan from Spanish bank BBVA, though there’s still no long-term solution in sight.

5,000 Year-Old Beer Recipe Unearthed in China

Archaeologists from Stanford University have discovered a recipe for beer more than 5,000 years old, which marks the earliest recorded use of barley in China. 

The discovery was made along a tributary of the Wei River, where scientists unearthed equipment presumably used for brewing, filtration and storage of beer including amphorae, funnels, stoves and wide-mouthed pots. Inside the containers lay the residue from a liquid which included barley, “Job’s Tears” (Chinese pearl barley), broomcorn millet and tubers like potatoes and yams. 

Though the ingredients would have likely made a somewhat flavorless brew, this discovery pushes back the time when barley was first thought to be used by more than a thousand years, which would mean that the Chinese were using barley for brewing beer-like beverages before they were eating it, contrary to what was previously thought.

Florida Brewery Creates Edible Six-Pack Rings

The Delray Beach, Florida-based Saltwater Brewery has pioneered a novel way to help protect the environment – edible six-pack rings. 

These 100 percent biodegradable beauties are made with spent grains, and are reputed to be as durable as regular packaging, without putting marine wildlife at risk.

Though the edible rings currently run a bit more expensive than regular packaging, Saltwater Brewery hopes that increased interest from other breweries will ramp up production and drive down costs.

Anheuser-Busch Renames Budweiser Brand “America”

Just in time for Independence Day, Anheuser-Busch has announced that its flagship brand, Budweiser, will be seasonally renamed as ‘America.’

‘The King of Beers’ will now be emblazoned with the nation’s motto of E Pluribus Unum, or “out of many, one.” Despite the fact that Anheuser-Busch is owned by AB InBev, a massive multinational company headquartered in Belgium and Brazil, the ‘America’ move is being touted as a call for unity in what Ricardo Marques, a Bud VP touted as “maybe the most American summer ever.” 

“We thought nothing was more iconic than Budweiser and nothing was more iconic than America,” professed Tosh Hall, creative director at JKR, the branding firm behind the campaign.

It could be argued that supporting local craft, which creates more new jobs than macro, is more American, but to make this out as a battle of U.S. and them would be a cheap, watered-down rhetorical ploy.

Love it or hate it, it’s an interesting marketing strategy, and at the end of the day, nothing is more American than old-fashioned capitalism.

Photos courtesy Beer Street Journal (Sweetwater Brewing Co.), Yunhu Beer and Ryan McFarland (http://www.zieak.com/).