The Craft Beer Market May Be on the Move in 2021
There have been a lot of changes to the craft beer market over the last 18 months. Some smaller craft breweries have had to confront the prospect of closure, while others are seeking out new growth opportunities.
This article will examine market insight that showed a downturn for the craft beer market in 2020. Then, we’ll look at economic data indicating an improvement to the market’s prospects in 2021.
The craft beer market took a serious hit from the coronavirus pandemic in 2020. According to insight from a not-for-profit trade group, the Brewers Association, sales of U.S. beer fell by 3% in 2020 and fell by as much as 9% in the craft beer market.
The number of U.S. craft breweries fell for the first time in over five years in 2020, down to 220 breweries in 2020 compared with 240 in 2019. This downturn posed a severe threat to the craft brewing industry, which considerably contributes to the U.S. economy.
According to Brewers Association figures, the craft brewing industry is worth over $60 billion to the U.S. economy. Over 400,000 jobs were at risk because of the 2020 hit.
While the craft brewing industry suffered a serious setback in 2020, economic conditions in 2021 look more encouraging. The lift in coronavirus restrictions, combined with a rise in consumer confidence, has prompted a return to bars and restaurants in the first half of 2021.
According to figures from the Labor Department, the U.S. economy added a robust 943,000 jobs in July, of which more than a quarter – some 253,000 jobs – involved bars and restaurants.
In addition, there’s also been a substantial increase in the number of restaurant diners in the U.S. so far in 2021, particularly in the second quarter. This trend is closely linked to the increased demand for craft beers.
According to Bill Reynard, these economic data suggest that a strong recovery is looming in the craft beer market. Aside from being major suppliers of craft beer, bars, restaurants, and other public venues are often the foremost opportunities for smaller brewers to showcase their products to new customers. As such, the reopening of bars and restaurants is a major boon to craft brewers, who will once again be able to reach new customers with their innovative local products.
While economic data has shown the potential for the craft beer market in 2021, it’s helpful to turn to case studies to help illuminate the wider industry trends. Here are some examples that suggest that the craft brewing industry is making a strong comeback in 2021.
Barcade Detroit is a new bar experience in Midtown Detroit that opened in August. Aside from the huge number of pinball and other arcade games available, the venue offers a selection of two dozen American beers on draft. The offering has a deliberate and distinct craft beer focus, with many beers sourced from local Michigan breweries.
Agile Brewing is a new craft brewer setting up shop in Louisiana. Their site, at Barringer Foreman Technology Park, had previously been the site of the Southern Craft brewing company, which was forced to close as a result of the downturn caused by the pandemic.
Agile’s founder, Keith Primeaux, currently runs a homebrewing supplies business, LA Homebrew, but spotted the opportunity to move into the professional craft brewing business and was keen to take it.
The new brewery, which is set to open later in 2021, will employ 5-6 staff and will produce a range of 20 different drinks once it opens.
A new craft brewery has been set up in Tallahassee as part of the expansion efforts of the Blountstown Beer Company. One of the founders, Josh Parker, said he’s “running out of beer” at their existing site and has had to open this new location to meet the ever-increasing demand for craft beer. This new venue is contributing to the local beer culture that dominates much of this area.
According to experts, the American craft beer market is experiencing a robust return to growth in 2021. While 2020 proved challenging for several craft brewers, even causing some to close operations altogether, 2021 has marked a turnaround.
With renewed consumer confidence, increased jobs in the leisure and hospitality sectors, and a greater footfall in bars and restaurants, there’s never been a greater time to be in the craft beer sector. Well-established operations are taking this chance to return to their former glory. And at the same time, new businesses recognize this lucrative industry and seek to capitalize on its potential.