Craft beer is still booming, but with an interesting new wrinkle.
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This week, the Brewers Association – the trade association representing small and independent American craft brewers – released its annual data on the growth in craft brewing for the previous year. As any beer fan could probably anticipate, the general trend was the same as it’s been for about a decade: craft beer continues to boom. However, a deeper dive adds an interesting wrinkle: big brewers may finally be having an impact on America’s independent beer scene.

First, the most eye-popping number: As of 2016, America was home 5,301 breweries. That marks eleven straight years of increases dating back to 2006 – when a then-impressive 1,460 breweries existed. It’s easily the most meteoric rise in the history of American brewing: a longer and more sustained explosion than the previous boom in the 1990s. Last year, 826 new breweries opened and only 97 closed.

Despite this, however, the percent of overall beer volume produced by craft brewers only grew by 0.1 percent, reaching 12.6 percent total. By comparison, craft brewers’ volume share had grown by at least a full percentage point each of the past three years. Granted, craft brewers now account for over double the share they had just five years ago (when the volume of craft beer was just 5.7 percent), but the trend slowed in 2016.

So how did the amount of breweries keep growing so rapidly, but the share of volume stall out? Well, there’s the wrinkle: A number of large, former “craft” brewers had their “craft” label revoked after being bought out or significantly invested in by major non-craft breweries. For instance, Lagunitas and Ballast Point were the sixth and eleventh largest craft brewers in 2015, but thanks to money from Heineken and Constellation Brands respectively, those breweries didn’t count towards the “craft” numbers for 2016. “By adding 1.4 million barrels, craft brewer growth outpaced the 1.2 million barrels lost from the craft segment, based on purchases by large brewing companies,” the BA explained. As a result, “Microbreweries and brewpubs delivered 90 percent of the craft brewer growth.”

“Small and independent brewers are operating in a new brewing reality still filled with opportunity, but within a much more competitive landscape,” Bart Watson, the Brewers Association’s chief economist, was quoted as saying. “As the overall beer market remains static and the large global brewers lose volume, their strategy has been to focus on acquiring craft brewers. This has been a catalyst for slower growth for small and independent brewers and endangered consumer access to certain brands. Small and independent brewers were able to fill in the barrels lost to acquisitions and show steady growth but at a rate more reflective of today’s industry dynamics. The average brewer is getting smaller and growth is more diffuse within the craft category, with producers at the tail helping to drive growth for the overall segment.”

What the BA fails to address is a general consumer perspective. While the Brewers Association’s job as a trade organization is to follow the money, many beer drinkers do not. The result is that even though a drinker’s favorite “craft” beer may no longer fit the BA’s definition of “craft,” to these consumers, those brews are probably still craftier than what they were seeing a decade ago. So even though official craft beer volumes may have stagnated a bit, the actual beer market is still shifting away from the macro-lagers of the past. Interestingly, “craft-style” beers continue to grow unabated, but more than ever before, the ownerships behind them are becoming more complicated.