http://www.brewersassociation.org/insights/non-beer-bubble-part-deux/

So despite my earlier efforts to dispel the notion that the number of breweries in this country represents some sort of bubble, “are we at the saturation point?” or “is this a beer bubble?” continues to be the most popular media question I field. While I’m a bit hurt that the mass media doesn’t read the blog, here goes round two in dispelling the notion that reaching 3,000 breweries means the country simply can’t take any more. It all stems from a simple concept:

MOST BREWERIES ARE SMALL AND LOCALLY FOCUSED…

Recommended article to check out.

Watson certainly makes a compelling argument and with the data shown, understanding his view is pretty much a no-brainer.

A couple points that came to mind…

  • New growth cannibalizing the existing craft beer drinker base that may not want to grow as fast (or steadily) as the number of breweries opening or beer brewed. I guess maintaining quality and innovation is the answer to this one. Oh, and craft beer fans not being judgmental/elitist towards macro fans and thus, turning them away forever, from the possibility of switching teams.
  • Distribution of natural resources. There’s only so much grain and hops available for brewing. The fact of “higher quality” in craft beer is that uses a dramatically higher amount of malt and hops than macro brews (who use additional adjuncts in place of a large percentage of barley and, in general, don’t try to achieve the same level of bitterness while also using more efficient, downstream hop products). Hop shortages of popular varieties are already beginning to happen. And I wonder about the same thing happening with grain in the future. This is to say nothing of water. Even the most efficient breweries I’ve heard of (Full Sail and Alaskan Brewing Co) use 2.5 gallons of water to produce 1 gallon of finished beer. Macros are working on getting their ratio down to 3.5 gallons for 1 gallon of finished beer and the industry average is about 5 to 1 (meaning some are worse). This also doesn’t take into consideration the amount of water used to grow the grain and hops.

I don’t think there’s a bubble, per se, or that it will “burst.” Watson is much smarter than I am and he’s got the numbers to back up his assertion. But I do think there is a ceiling craft beer will come up against, in some form or fashion, at some point in the not too distant future.

*Source for figures on water usage: http://brewingandsustainability.wordpress.com

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