Craft Beer Troubles are Brewing

Craft Beer TroublesCraft brewers are unhappy that megabrewers Molson Coors and Anheuser-Busch InBev are using the term craft beer. A-B said that Budweiser is a craft beer. On the other hand, Coors is trying to change the marketing on its Silver Bullet to suggest that a brewmaster stirred a copper kettle to make it.

The Brewers Association slammed the giant breweries for trying to pass themselves as small craft shops. They pointed out that A-B and SABMiller control 75 percent of the beer market. The association said that just because they make small-run beers doesn’t make them craft beer brewers. Acquiring craft brewers have also skunk the definition.

The large brewers want to be associated with the craft beer movement because it is a growing industry. It grew 13 percent in 2011 by volume and 15 percent min sales. In the first half of 2012, volumes are 12 percent higher and sales have gone up 14 percent.

Boston Beer is the largest craft beer brewer with its Samuel Adams brand. It predicts its 2012 earnings to be around $4.30 to $4.60 per share. It was up from the previous estimate of $3.80 to $4.20. Analysts expect its earnings to be $4.34 per share.

But it’s not a positive one for the beer market in general. Overall beer market grew just 1.9 percent for the first eight months of the year according to the Beer Institute. Brewers were not complaining about it since sales have been moving in the right direction from their 2011 sales, which was down 1.5 percent.

Alcoholic beverages in general have been having a good year so far. Sales grew 3 percent to 4 percent compared to the past year. But it was not good news. Craft Brew Alliance saw an increase of 21 percent in depletions to its Kona brand. Wildmer Brothers dropped 9 percent in the third quarter.

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