Olly Wehring's beverage industry blog - from just-drinks.com

Tax issue is no small beer for US brewers

Fri, 17 May 2013 16:41:00 GMT

The gloves are off in Washington DC as the big (and the not so big) brewers tussle with small brewers over tax.

In the red corner, are the likes of Anheuser-Busch InBev and MillerCoors, who are backing the 'Brewers Excise and Economic Relief Act of 2013', otherwise known as the BEER Act.

Under the Act, introduced in the House of Representatives last week, the federal excise tax on beer for all brewers and beer importers would be cut.

This is the proposal:

· Small brewers would pay no federal excise tax on the first 15,000 barrels; US$3.50 on 15,001 to 60,000 barrels and $9 per barrel for every barrel over 60,000 and up to 2m barrels

· Brewers producing more than 2m barrels annually, and for all beer importers regardless of size, the federal excise tax rate would be $9 per barrel for every barrel

The Beer Institute, the US trade body which represents the big brewers, claims this a "fair, equitable tax policy".

However, in the blue corner representing smaller, craft brewers, the Brewers Association (BA) is not impressed. An alternative act, the Small BREW Act, which reached the Senate last week, seeks cuts only for smaller scale producers.

But it is a tangled web, as Jason Notte explains, writing on The Street website. For one, Brooklyn Brewery is among those supporting the BEER Act. Meanwhile, he suggests that the levels proposed in the Act would imply that Boston Beer Company is not a craft brewer, which is part of the reason the BA changed its defintion two years ago.

Meanwhile, Deschutes Brewery founder Gary Fish also found himself caught between the two.

Who'll be left standing?

US$15m for Coca-Cola's original recipe? Not these days

Wed, 15 May 2013 10:56:00 GMT

You can get all sorts of things on eBay - a new laptop, a car, the original recipe for Coca-Cola.

Yes, really. Well, probably. A man called Cliff Kluge claims to have found the soft drinks equivalent of the holy grail in a pile of letters bought at an estate sale in Georgia and is now selling it on the online auction site for up to US$15m.

Sorry, how much?

Cliff is obviously unaware of the declining value of full-sugar cola CSDs that has seen The Coca-Cola Co embrace low- and no-calorie ideals and PepsiCo attempt to reinvent the category with a sweetener shakeup.

Now, if he were to find a recipe for a zero-calorie carbonated soft-drink that uses all-natural ingredients and shifts over a billion cans a day, then I'm sure he could name his price.

I can think of at least two companies that would be very interested.

Iron Maiden rocked by Sweden's alcohol rules

Tue, 14 May 2013 13:34:00 GMT

When you're one of the most successful heavy metal bands in history, with nearly 9m Facebook fans, you can probably cope with the odd setback.

Last week, Iron Maiden launched their own ale - Trooper - brewed by Cheshire-based family brewer Robinsons. According to beer writer Marverine Cole, the brewery has secured pre-orders from a whopping 184 countries, while Robinsons has been forced to move to a six-day week to meet demand.

But, the brew (4.8% abv in cask, 4.7% in bottled format) has hit a stumbling block in Sweden. The country's state-run liquor store monopoly, Systembolaget, has aborted the launch of Trooper in its outlets over fears the skull and crossbones on the label does not adhere to the country's alcohol laws, it has been reported.

Will the private-jet travelling hellraisers be forced to change the label? Or, will they abandon selling the beer in Sweden?

Strangely, I don't remember this kind of kerfuffle when indie epic-balladeers Elbow launched their beer, Build a Rocket Boys, with Robinsons in 2011.

Funny that.

Reputation re-building as Mr 'New Coke' heads to Castle

Fri, 10 May 2013 14:38:00 GMT

There's an old joke that riffs on an unfortunate elderly farmer who can't live down an amorous encounter with a fluffy farm animal. Never mind that it happened once, and a long time ago at that, he's destined to be forever known around his local village by a nickname I can't repeat here.

I remembered the joke today when I read about a former CMO of the Coca-Cola Co who is joining the board of directors at Castle Brands, a spirits and wines brand developer based out of New York. Sergio Zyman is a multiple author, writer of such memorable slogans as “Coke Is It” and a man who reportedly sold a majority stake in his marketing firm for US$63.8m.

However, because he was behind the fiasco that was 'New Coke', he won't be remembered for any of that. Instead any story on Zyman (including ours) will forever refer to him first and foremost as “the guy who gave us New Coke”.

Some things you can never live down.

MAY-DAY! MAY-DAY! just-drinks is closed on May Day

Fri, 03 May 2013 17:33:00 GMT

It's the May Day Bank Holiday here in the UK this coming Monday (6 May). So, we'll be spending the day watching the garden get a thorough drenching for the day, rather than mining the drinks world for news.

We're back on Tuesday.

Up the workers!

Beam Inc - Hey, fellas, I have an idea

Fri, 03 May 2013 12:53:00 GMT

Did anyone else find it curious yesterday to see volumes of Maker's Mark soar in Beam Inc's first quarter? After all, a 44% leap in quarterly volumes year-on-year positively jumped off the page.

My eyebrows rose even higher when Beam CEO Matt Shattock conceded that the brands performance in the three months to the end of March was related to the company's announcement – and then the subsequent climbdown – that it was reducing the Bourbon's abv.

Maybe, if Beam makes this move every quarter – perhaps with a different brand each time – it would prevent the “cycling tough comps” line from having to be resorted to.

Craft Brewers - Think Global. Drink Local

Mon, 29 Apr 2013 13:01:00 GMT

Click play, below, to see how one craft brewer is taking on the "mass corporate machine", courtesy of The Motley Fool.

Beefeater Borough's Reserve: But, where are the beefeaters?

Mon, 22 Apr 2013 15:53:00 GMT

Well, Pernod Ricard, I must say I am a mite disappointed in you.

Just over four years ago, Pernod's Chivas Brothers Scotch and premium gin unit put on the party to end all parties to back the launch of Beefeater 24. The addition of a permanent extension to Beefeater's portfolio warranted a fleet of Mercedes to collect us from the nearest train station, the hire of the home of the Duke of Northumberland, Syon Park, and the recruitment of the circus troupe and vaudeville act Lost Vagueness to provide entertainment at literally every corner.

The announcement - if you want to call it that - of the latest Beefeater extension today, however, didn't quite match up.

All we got to herald the launch of Beefeater Burrough's Reserve on this miserable Monday was a press release and a photo. No swanky cars, no posh pile in the country... Dammit, not even any fire-eating beefeaters.

And, as many of you know, my opinion has always been: No fire-eating beefeaters; no comment.

Craft distillers of the world unite...

Tue, 16 Apr 2013 16:57:00 GMT

Craft distillers are getting evermore serious and getting together.

Trade groups exclusively representing craft producers' interests exist both sides of the Atlantic, with a new body having just popped up.

The American Craft Distillers Association has been formed this month to "promote and protect craft distilling in the United States", Modern Distillery Age reported in its latest issue. This is in addition to the American Distilling Institute, which has already existed for ten years, and claims to be the voice of "artisan distilling".

Meanwhile, in the UK, the Craft Distillers' Alliance has just appointed a chairman - Stephen Davies, MD of Welsh whisky distillery Penderyn. The group was set-up last year by whisk(e)y writer Dominic Roskrow and already numbers around 30 members.

We'll just have to see if any finger-pointing crops up over what constitutes a "craft" product, as is the case in the brewing world right now.

Follow me on Twitter @jamescwilmore

Fuller's... kind of like the Murdoch empire

Fri, 05 Apr 2013 15:21:00 GMT

Listeners to BBC Radio 4's Today programme may have choked on their cornflakes this morning as presenter Simon Jack compared Fuller's to the Murdoch empire.

Jack was referring to the similiarity in ownership structure between the two.

Michael Turner, who is taking a back seat as head of the London-based brewer and pub company from July, also discussed the win for beer in last month's UK Budget and the thorny issue of minimum pricing.

The interview can be heard here.

Follow me on Twitter @jamescwilmore

George Osborne helps beer campaigners celebrate Budget

Thu, 28 Mar 2013 17:01:00 GMT

A drinks gathering in a London pub this week will have done little to quell the fury of wine and spirits producers, following last week's UK Budget.

None other than the Chancellor himself rocked-up for a pint to help the UK's pub and brewing fraternity celebrate his (or may be David Cameron's?) decision to scrap the duty escalator on beer and offer an extra tax cut.

Photographic evidence here.

With the Wine & Spirit Trade Association still pondering legal action over George Osborne's singling out of beer, and the Scotch Whisky Association branding it an “unfair and incomprehensible blow”, I'm sure this gathering will have gone down like the proverbial metal inflatable with this section of the industry.

Cue bottles of Pinot and single malt Scotch being sent to 11 Downing Street? Possibly.

Follow me on Twitter @jamescwilmore

Radio Wine

Tue, 26 Mar 2013 12:47:00 GMT

Last week, BBC Radio 4 broadcast a panel discussion on the current state of the wine industry in the UK. It makes for pretty interesting listening.

My favourite quote: "Wine is a complicated, difficult business with a relatively low level of proven profitability."

That's the spirit!

Click here to listen to the 30-minute programme.

just-drinks at ProWein

Fri, 22 Mar 2013 10:44:00 GMT

It's a dirty job, but someone has to do it. I'll be among the wine and spirits trade fraternity at ProWein, in Dusseldorf, Germany, on Monday.

If you're a publicity-hungry producer, or want to find out more about the wonderful world of just-drinks, feel free to collar me for a chat.

Alternatively, email: james.wilmore@just-drinks.com

Cheers.

Follow me on Twitter @jamescwilmore

Russia's rich fuelling a brewing revolution

Fri, 15 Mar 2013 12:34:00 GMT

Just-drinks is at BeerX (15 March), the annual get-together of the Society of Independent Brewers (SIBA).

It's in Sheffield, but maybe SIBA should consider a branch meeting in St Petersburg. According to a sales manager for Keg Technik, a German keg filling manufacture, the real brewing action is in Russia, where rich businessmen are investing spare cash in their own vanity breweries.

“They're sprouting up like mushrooms,” said Christopher, whose company is tapping into the growing demand for equipment from these wealthy hobbyists, who are apparently making good profits.

You heard it here first folks.

Stevia - a bitter pill for sugar?

Thu, 14 Mar 2013 15:01:00 GMT

There's an interesting article on sugar prices in this week's New York magazine that will no doubt raise the ire of soft drinks executives.

It claims that despite massive government subsidies - and a recent big harvest - the US sugar industry is keeping prices artificially high.

But while the writer calls for an Occupy Sugar protest, the US drinks companies paying through the nose for sugar may have another answer. More stevia-based beverages are coming down the pipe each week, from PepsiCo's Trop50 range to The Coca-Cola Co's revamped Sprite, and the natural extract, which is 30 times sweeter than sugar, could insulate firms from the sugar industry.

As I wrote this year, stevia growers are already benefiting from an increase in interest in the plant.

Of course, who's to say that a few years down the line we won't need protecting from the all-powerful stevia lobby, who's huge profits have won it the ear of Washington and the patronage of the president?

Remember, you heard it here first - Occupy Stevia!

Gangnam breaks into the wine world - as forecast on just-drinks

Tue, 12 Mar 2013 12:02:00 GMT

Every January on just-drinks, our wine commentator, Chris Losh, delivers his predictions for the coming year.

This year, Chris had a lot of fun suggesting that Gangnam Style will take over the wine industry, with wine regions the world over expected to ride the wave of the dance craze.

Hats off, then, to John Jordan, the owner of Jordan Winery in Sonoma County, California, for being the first - that we know of.

Muhtar Kent and the US$21.6m price of leadership

Fri, 01 Mar 2013 17:22:00 GMT

It was a good 2012 for Muhtar Kent, who was paid US$21.6m for his position at the helm of The Coca-Cola Co, accoring to AP today (1 March).

It was $400,000 more than he got the year before, AP said, mainly because of the increase in basic salary Coca-Cola furnished him with. Perhaps the company knows just how tough it must be to run a soft drinks company these days, with pressures over obesity issues increasing and sugar prices ruining margins.

For that sort of pay packet, though, I'm sure there's a few people out there who'd be willing to give it a go.

Broccoli haters enjoy fruits of smoothie-makers' labour

Wed, 27 Feb 2013 12:57:00 GMT

Vegetable smoothies are nothing new - Jennifer Aniston, for one, has been drinking them for some time, while teen band One Direction, for another, reportedly use them to fight off spots.

But last week, independent smoothie maker Savse launched its vegetable-and-fruit concoctions in the UK while yesterday (26 February) US healthy-eating franchise Tropical Smoothie Cafe unveiled its own line of vegetable smoothies with a fruity twist.

I sense a trend.

Savse told me that the fruit sweetens the more bitter vegetable edge and swears that most people who buy its broccoli smoothie can't taste the broccoli. The company is marketing it at parents looking to smuggle veggies into their children's diets, but it's also supposedly a hit with athletes looking for some tasty nutrition.

So, will others dare follow the smoothie lead? Campbells already has its on-trade V8 line while, in China, convenience stores carry a good selection of locally-made, and heavily-sweetened, fruit-and-vegetable RTD juices. As obesity issues increasingly influence consumer choice, how long will it be before we see more broccoli and berry fusions?

Fridges stay cool with fresh innovation

Thu, 28 Feb 2013 16:06:00 GMT

There has been a spate of late in the world of fridge innovation.

Last week, ahead of its full-year results, SodaStream unveiled a US$3,899 Samsung refrigerator that dispenses the company's patented fizzy water from its front door. And on Wednesday (27 February) Coca-Cola Amatil (CCA) released an interactive retail cooler that can tell customers what deals are in play, and features digital panels that act like a giant smartphone.

There's some wobbly footage of the CCA fridge in the Youtube clip below, which gives some idea of its capabilities. This one holds Beam Inc's Devils Cut & cola RTD, which is only available in Australia.

Innocent co-founder discusses sale to Coca-Cola Co

Mon, 25 Feb 2013 10:38:00 GMT

Could this be the end of an era? The founders of UK smoothie maker Innocent revealed on Friday that they are effectively giving up ownership of the firm to the Coca-Cola Co.

Richard Reed confirmed that he and his fellow Innocent co-founders will step down from running the company on a "day-to-day basis". But, the smoothie maker will still be run by "Innocent people", he said.

The UK group first sold a stake to Coca-Cola in 2009.

Reed has recorded a video message about the deal, which can be viewed below.