What’s coming up in beer in 2022? – Predictions for the Year Ahead – comment

To say that the past couple of years have been turbulent ones for the global brewing industry is to make an understatement of the highest order. But, guess what? Things are only going to get more so in the coming year, or at least that's how it’s already looking in these early weeks. Here is some of what I’m seeing in my crystal ball. M&A mania! The year had scarcely begun when the first divestment/acquisition was announced, with Molson Coors Beverage Co ridding itself of its Saint Archer assets (save the intellectual property) and upstart Illinois brewer Kings & Convicts snapping up the San Diego brewery and taproom. This was followed rapidly by several other announcements, including at least one, the sale of southern California’s Green Flash and Alpine Brewing to Canadian cannabis company Tilray, that would have been huge news had it occurred even a couple of years ago when Green Flash was still something of a craft brewing dynamo. Huge news did, of course, follow within a couple of days, with Monster Beverage Corp acquiring the CANarchy Collective of Oskar Blues, Cigar City and several other US craft breweries. Less than a week later, Kirin’s craft division, Lion Little World Beverages, announced that it was exploring the sale of its pair of UK breweries, Fourpure and Magic Rock. Remarkably, all of this took place within the first three weeks of this year. It’s hardly surprising, then, that my first prediction for 2022 is much, much more of the same. With companies like Kirin and Molson Coors finally appearing to have developed cohesive strategies for craft beer, as opposed to what appeared to be more of a scattergun approach in the past, one might easily expect further divestments from the big brewers, even and perhaps especially brewery-rich Anheuser-Busch InBev. Meanwhile, first-generation craft brewery owners who are either approaching or of retirement age will be looking to cash out to a life of leisure. No predictions – yet! – about who might wind up buying what, but it's almost certain that the year will ultimately close with the world's craft beer landscape looking quite different than it does today. Co-op Mania! Of course, sell-offs only work when there are buyers - and that seems to be less the case, at least within the brewing industry proper. (Cannabis companies buying into beer seem to be the wildcard in this regard) As such, expect to see more groupings of craft brewers along the lines of CANarchy and Artisanal Brewing Ventures in the US and the marketing and distribution tie-up of Steam Whistle, Beau’s and Phillip’s in Canada. Whither hard seltzer? With January barely begun, industry analysts are already debating what has become known as 'The Great Seltzer Re-Set', Most opinions support the notion of continued but more reasonable and conservative growth for the segment through 2022 and beyond. Allow me to dissent. Sort of. While I concur that hard seltzer may indeed grow in more modest terms through this year and perhaps into next, I also believe that its heyday as a category has run its course. The future for alcoholic sparkling water will be best served by blurring the lines between its 'Flavoured Malt Beverage' roots and increasingly common grouping with the wider 'Ready To Drink' category, including spirits and wine-based beverages. In such company, the word ‘seltzer’ may be expanded to include all manner of compositions, from the almost comical dill pickle and eggnog flavours we saw at the end of last year to replications of mixed drinks and cocktails, and so capitalise on what has always been its greatest strength, specifically wave after wave of new iterations. To put it another way, while hard seltzer as an FMB may have more or less run its course, as an RTD made from a multitude of base alcohols, it can have a bright future for several years to come. The supply chain and consumer prices It wouldn’t be 2022 if I didn’t mention supply chain, and so here we are. Pretty much everything that goes into the production of a package of beer - from malt and hops to cans and bottles - is suffering supply chain issues these days. Even when these issues eventually get resolved, as they certainly must, some issues are sure to linger. Such as, for instance, higher prices. If not quite an immutable law, it's certainly a central tenet of capitalism that, once prices go up, they very rarely come back down. As such, brewers are likely to be stuck paying more in input costs, which will most surely result in beer drinkers paying more for their pints and bottles and cans. Paradoxically, this might wind up being not so bad news for the craft beer sector. As craft already owns high beer prices - and consumers seem willing to pay them - price increases of, say, US$0.15 or $0.20 a package will perhaps be found to be more tolerable by craft beer drinkers than they will by mass-market consumers. And, speaking of premiumisation... While the beginning of the pandemic saw beer consumers flocking to established, familiar and, in many cases, cheaper beer brands, more recently the beer market has seen a revival of the ‘Drink Less, Drink Better’ mantra. This time around, though, the message seems to be getting through to the big international brewers, who, frankly, are already leading the charge into the premium segment, and will likely continue to do so through 2022 and well beyond. What’s set to shape the beer category in 2022? – Just Drinks thinks

What’s coming up in beer in 2022? – Predictions for the Year Ahead – comment

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