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Craft beer to have a national association

November 3, 2011 by Matt Kirkegaard

[update – listen to  Brendan Varis discuss Craft Beer Limited and it’s aims here. Brendan starts at 27:00)

After years of waiting, Australia’s smaller breweries finally have a unified voice with the official launch of a national body to represent the craft brewing industry.

Craft Beer Limited, which has been in development since early this year, has finally gone live and is encouraging Australia’s smaller brewers to join in to ensure and accelerate the growth of craft beer.

The body has been driven by a steering committee comprising:

  • Brad Rogers & Jamie Cook – Stone & Wood
  • Brendan Varis – Feral Brewing Company
  • Dave Bonighton – Mountain Goat
  • Miles Hull – Little Creatures
  • Owen Johnston – Moo Brew
  • Adam Trippe-Smith & Bruce Peachey – McLaren Vale Beer Company

Details of the Craft Beer Limited have been released, including an introductory letter, prospectus, Constitution and Q&As.

The body has set itself a variety of goals, including:

  • Growing the size of the category in the next five years from 2% to 5% of total beer volume.
  • Ensuring that the microbrewers and regional craft brewers grow in line with the category (i.e. more than double their share of volume).
  • Increasing penetration and frequency of craft beer consumption amongst alcohol drinkers.
  • Increasing the on-premise access for craft beer resulting in increased ranging / distribution.

After years of grappling with definitions of exactly what is craft beer, CBL has opted to define an Australian Craft Brewer as, “A brewer based in Australia producing less than 25 million litres of beer per annum.”

Four categories of brewer are provided for under the association: National Craft Brewers, Regional Craft Brewers, Micro-brewers and Nano and Pub Brewers. This sets the eligible brewery size as many times larger than Little Creatures which is regarded as the fourth largest brewing operation in the country, behind Fosters/SABMiller, Lion (Kirin), and Coopers.  To give an indication of the market size, despite being the fourth largest entity, Little Creatures owner, Little World Beverages, claims only 0.5% of the national beer market. The volume definition therefore allows for considerable growth in the craft beer market.

The definition excludes Australia’s largest locally owned brewery, Coopers, which produces in excess of 60 million litres per year. The definition would include wholly owned but independent brewing entities such as Malt Shovel Brewery (Lion Nathan) and Matilda Bay (Fosters).

The purely volume-based definition departs from the widely known US Brewers Association definition, which considers ownership and brewing methods in addition to size. The Australian definition  reflects the difficulty that has been experienced in adequately creating a definition for the local market that unifies all participants. The approach that has been taken recognises that Australia has been without a body representing smaller brewers for too long already and that further delay will do more to retard the industry than a more refined definition will enhance it.

The volume-based definition still offers all small breweries the ability to differentiate themselves and their individual strengths within the market, while still unifying a disparate group of brewers who together still only constitute less than 3 per cent  of the total beer market.

Memberships are also open to groups and individuals who are not themselves brewers but are keenly interested in beer, including as home brewers, beer writers, bloggers, bar staff, sommeliers and bottle shop staff.

The website for the association will be at www.craftbeer.org.au.

In the meantime you can ‘Like’ them at www.facebook.com/australiancraftbeer.

Reader Interactions

Comments

  1. Pete Mitcham says

    November 3, 2011 at 5:01 pm

    Well, here it is and best of luck to it! A united approach to promoting and nurturing the craft beer scene in Australia is just what is needed. This should be all about good beer and not who owns who and who pays who’s bills – it’s just about the beer. Let’s hope that all brewers around the country see the value to their businesses by being a part of it. We will all look on with interest.

    • Roger says

      November 5, 2011 at 12:39 pm

      Good try. I don’t buy Matilda Bay or Little Creatures because I know it’s not a real craft beer. So a polite warning to genuine craft brewers that think that being part of this association would be beneficial is to have a think about why you would want your brands to be associated with fake craft beer brands. Think of how you want to build and maintain brand equity. You are giving a leg up to the guys at Little Creatures who didn’t have the guts to play against the majors by allowing them to be associated with your genuine brands. The US has courage – those that join this association are confused. Genuine craft brewers will risk creating very poor brand associations. I’d steer clear and leave this one.

      • Editor says

        November 5, 2011 at 1:15 pm

        Critics of this association seem to be very good at saying what isn’t ‘craft beer’, but are completely unable to agree on what craft beer is – let alone create a viable alternative. It’s a little like the Occupy movements at the moment. They can agree about what they’re against but are unable to enunciate a consensus about what they support and, as soon as it comes to doing that, they collapse into infighting and arguments. They’re good at protesting, not so good at proposing an alternative.

        This isn’t a question of whether an association should have breweries such as Matilda Bay and Little Creatures in or not, it’s about whether you want an association of craft brewers or not. If those who don’t want the larger craft breweries in could agree on what they stood for as opposed to what they’re against, there would have been an association long ago. There isn’t one.

        It’s fine to say that those who join this association are confused…but what association will you be joining instead?

        It’s great to be passionate, but there comes a time to be realistic as well. Joining this national association creates no association with any brand other than wanting a unified voice for craft beer.

        • Roger says

          November 5, 2011 at 1:44 pm

          Still confused…ok if you think that I’m being negative here’s an idea: adopt the US definition and alter the threshold for volumes. I would have thought that would have been a good starting point. Instead Australia’s craft beer industry will be associated with brands like James Squires that use adjuncts and are owned by Japanese multinationals. Yeah really smart play. Have fun getting support in Canberra for changing the definition of a microbrewer with fake craft brewers in the tent. This association is the worst thing that could happen.
          Your comment that “this should be all about good beer and not who owns who and who pays who’s bills” is complete and utter nonsense. So answer this question: why should Australia’s definition be different to the US’?

          • Editor says

            November 5, 2011 at 2:36 pm

            Why alter the threshold for volumes? Why is 702,000,000 litres of beer ‘craft’ in the US but one tenth of that volume isn’t just because you cross the Pacific? If you want to scale it back, what should it be scaled back to? Australia’s population is one thirteenth that of the US….should ‘craft beer’ in Australia be one thirteenth that in the US? That would be 54,000,000 litres – double what is proposed. Australia has (it’s impossible to say without a definition, but let’s say) 100 craft breweries. That’s one seventeenth the number in the US. Should the figure be one seventeeth the size of the US defiinition? That’s 41,411,764 litres. If you’re going to scale it back, exactly what size should be considered craft here…if you can get 10 craft brewers to decide on the one figure alone you might have a chance of setting up an alternative association.

            If you decide on size, what happens when an independent Australian craft brewer changes nothing about their approach or their passion but outgrows the volume? Are they suddenly not in the club? What’s changed about their beer? Or do you change the ceiling? If so, why was the ceiling there in the first place?

            What if an an independent Australian craft brewer can’t keep up with demand on one of their most popular beers and gets it brewed under contract somewhere else? Are they still craft? If so, why isn’t someone who wholly owns his own beer company and produces flavoursome beer with passion, just wholly under contract, also a craft brewer? What if a craft brewer sells a portion of his company to an investor to give himself capital to expand without having to contract…at what point does he lose control of the company? 10%, 25%, 41.5%. What if the beer doesn’t change, why is it suddenly not ‘craft’?

            What happens if a non-brewery owning brewer gets his beer brewed by another craft brewer because it’s a safer business decision than owning stainless himself? Can he join? If so, what happens if the same guy then goes to a non-craft brewer to get the same beer made. Will you kick him out?

            These are just a few of the multitude of things that no two ‘craft’ brewers can agree on and why there has been no viable association before now. It is very easy to disagree with what is proposed but if you could get consensus on how it should be defined and set up, there would already be an association.

            As to getting Canberra to listen. If this association doesn’t go ahead, who exactly will be going to Canberra looking for support anyway.

        • Keith says

          November 9, 2011 at 5:48 pm

          Ed,

          preamble: I make craft beer for a living and have a vested interest in this conversation, that interest being I am committed to sharing my love of craft beer with the public.

          Craft beer is hard to define and any definition will cause debate.

          The proposal you have reported on defines a craft brewery as one producing less than 25 million litres. Surely the volume of beer produced should not define craft beer; and looking at the Australian market the proposal is to exclude Coopers, but include the boutique arms of the two major breweries which seems a little off the mark. I would suggest a definition of craft beer should reflect a craft approach: committment to the best quality beer – not beer driven by price point constraints, quality ingredients – not cheap local adjuncts, traditional brewing methods – not using processing aids to push through volume or high gravity brewing methods and the definition has to include people – the customer can put a face to the beer they are drinking (wether my face is a good thing that’s a whole other story;-)and they can have a relationship with the brewer. There should also be something about the brewer touching, using & tasting the ingredients & beer at every step of the process: from unloading ingredients to slapping on keg flats or putting bottles in cartons, but I don’t know how to express that properly.

          There will be debate about what constitutes craft beer and there should be debate, I don’t think my idea of what craft beer should be written in stone. But, I do know that what I do, how I do it & the beer I make is craft and that Malt Shovel is doing something different.

          I agree completely that a national body is well overdue, but I should be able to differentiate myself in the marketplace from the boutique arms of big breweries. This is not an unrealistic view point, it’s a very real commercial imperative. Comments from your readers attest to the fact that this differentiation already takes place. I believe that a national body representing craft brewers must recognise that on some issues there will be overlap between small craft breweries and the larger boutique breweries, but sometimes our interests will be different.

          As to choice about which national association to join: the failure to acknowledge differences between the big and the small; boutique beer owned by the major breweries and craft beer produced by independents will create more choices in the marketplace.

          And I for one am looking forward to making a choice that represent my interests, the interests of a craft brewer.

          Keith
          (for the record I work for the Hunter Beer Co.)

          • Editor says

            November 9, 2011 at 6:27 pm

            Thanks Keith, and thanks for putting your name to the comments!

            This is a very complicated issue, I agree. But let’s create a unified body for brewers, one that is big enough to be both viable and influential now. We can worry about the question of ‘independence’ once the ‘independent’ craft brewers make up more than their current.2% (that’s point two of a per cent, not two per cent) of the national beer market. The Australian craft beer marketplace – no matter how defined – is still so small that any growth benefits all.

            There is nothing in this association or the way that it is defined that stops the small, independent brewers from defining themselves that way in the marketplace and still being a member, or suggests that the larger wholly-owned ones are independent. It is about growing the market for better beer, and that is something that all can support.

      • Brendan v says

        November 6, 2011 at 11:22 pm

        Roger,

        Matilda bay and little creatures have for different reasons, greater marketing and advertising reach than my brewery. They are operating under different corporate structure to my business. Grant you that. To suggest there beers are any less craft than those that we brew just because of there structure, size or bank balance is simply wrong.

        The vast majority of craft beer consumers present and future don’t know or care about how big the pots and pans are that we use to make beer on nor do they care about our corporate structures. They will care about the beer. To setup an association that includes or excludes based on size and corporate structure would be misleading to the consumer as it is effectively trying to hijack the term craft beer for the exclusive use of a minority of small minded insular thinking brewers. The term Craft Beer would become even more irrelevant than it is currently as it would bear no resemblance to the market reality.

        An inclusive approach to membership by an association would allow it to use the current consumer understanding of the term craft beer and move forward to try and strengthen the equity of the term. This is not an easy task but achieving it would be crucial to the success of any national craft beer association.

        A US definition is simply not relevant to the Australian craft beer market for the reasons mentioned above. The definition we have is more in line with that of New Zealand when it comes to who is able to be a member. They have a very effective association there, one that I am personally envious of. They are achieving great things for craft brewers large and small with a very inclusive approach to membership.

        The only way craft beer in Australia will continue to prosper into the future is if brewers big and small present a clear concise and consistent message to consumers. I firmly believe the association we propose can help to achieve this.

        Brendan Varis
        Feral Brewing Co

  2. Ian Watson says

    November 3, 2011 at 7:02 pm

    hmmmmmm this is the first I have seen of this
    … so Coopers can’t join or be part of it but beer that potentially may be brewed at some of the largest breweries in the country can….. and these few large breweries (their offspring operations)would have the same representation on the board as the 120 or so small players.
    There could be a danger of becoming like the Distilled Spirits Council whose members are-
    Bacardi Lion Pty Ltd;
     Beam Global Australia Pty Ltd;
     Brown-Forman Australia;
     Bundaberg Distilling Company Pty Ltd;
     Diageo Australia Limited;
     Mast-Jägermeister AG;
     Moët Hennessy Australia Pty Ltd;
     Rémy Cointreau International Pte Ltd;
     Suntory (Australia) Pty Ltd; and
     William Grant & Sons International Ltd

    No Tamborine Mountain Distillery or Morpeth Moonshinery,Lark etc (amongst many)on that list.

    This may be a major negative when dealing with the media and Gov. … but still, it’s a start and I am interested to see where it heads from here.
    Also interested to know if individual brewers can join and be voting members just as their employer may be a voting member ?…. there are both benifits and complications to this question.

  3. Brendan v says

    November 4, 2011 at 12:07 am

    Ian
    Surprised you haven’t heard of this everyone else at murrays has. Happy to fill you in if need be. You know how to reach me
    Brendan V

  4. Miles Hull says

    November 6, 2011 at 3:45 pm

    Roger
    I would like to extend an open invitation to yourself if you ever find yourself in WA, to join me and the brewers for a walk through our brewery at Little Creatures – we would love to show you what we do and how we do it. I don’t expect that we may change your view on the world given your strong convictions but it may help demystify your view on Little Creatures and assist to explain that size, through brewery equipment or business, doesn’t have to be the determining factors for defining quality craft beer.
    We’re proud of the advancement of the Australian craft beer industry as a whole and it is our desire to see everyone grow together and we believe this association is the right platform to help make this happen.
    Miles Hull

  5. Barry Cranston says

    November 12, 2011 at 7:24 pm

    I just want to drink a good beer (“craft beer”) at the local pub/restaurant in my very normal suburb. This will not happen without the cooperation of all breweries that are are brewing “craft beer” be they be big, small or off shoots of the mega breweries.
    Cheers, Barry.

Category: News Tagged: Brewers Association, Craft Beer Limited

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