On Tuesday, the Brewers Association (BA) released its annual production report for the U.S. brewing industry. As was already beginning to become clear last year, the impact of the global pandemic meant beer took a hit in 2020, but the trade association’s report also shows small and independent producers met the challenge with resilience.
Collectively, craft brewery production dropped 9 percent compared to the year prior, which is the biggest hit the industry has taken in the modern era. Craft beer’s volume share of the market also dropped, from 13.6 percent in 2019 to 12.3 in 2020.
Craft producers, which the BA defines as those who brew 6 million barrels or less annually and who are less than 25 percent owned by a non-craft brewer, weren’t the only ones to suffer. The beer market as a whole fell 3 percent in volume, and draught sales were down 40 percent as a result of on-premise closures and significant capacity restrictions.
But even faced with substantial difficulties, craft breweries rose to the challenge. The number of producers reached an all-time high in 2020. While 346 breweries had to close their doors permanently, 716 new breweries opened for business, taking the total number to 8,764 in operation.
While the rate of independent brewery openings slowed 30 percent from the previous year, experts claim that this was inevitable, and only partly due to the Covid-19 crisis. Other contributing factors include increasing market competitiveness and maturity.
The good news is that there’s hope for craft breweries as the world slowly returns to some form of pre-pandemic normal.
“While many small breweries will remain under pressure until they can fully reopen and welcome their communities into their breweries, the 2020 closing rate has remained on par with 2019, suggesting that the vast majority of breweries will survive going forward,” said Bart Watson, chief economist of the Brewers Association.