These 11 brewers make over 90% of all U.S. beer
By Jason Notte
July 27, 2015
The story of beer in the U.S. in 2015 is basically whatever narrative you choose to believe.
The Brewers Association craft beer industry group tells us there are more than 3,400 breweries in the U.S., the most since 1873, and that choice abounds. However, about 1,400 of those are brewpubs that aren’t putting beers on bar taps or store shelves. Also, the 1,900 or so microbreweries that exist are competing in a U.S. beer market in which exactly nine companies controlled 90% of all beer sold here in 2014, according to Beer Marketer’s Insights.
We’re told that craft beer’s share of the market rose 17.6% last year, accounting for 11% of beer volume and $19.6 billion of the beer industry’s $101.5 billion in sales. However, it’s also a market in which the sale of imported beers rose 6.9% in 2014 and where, according to Nielsen, the amount of Mexican beer alone sold in grocery stores within the last year is equal to the amount of all craft beer sold from supermarket and convenience store beer shelves. It’s also a market where, despite advances by both craft and imported beers, one of every five beers sold is a Bud Light. In fact, the 38 million barrels of Bud Light sold last year would not only make it the No. 3 brewer in the U.S. if it split off from Anheuser-Busch InBev BUD, -0.84% but would give it a 16 million-barrel lead on every craft brewer combined.
When you look at the beer aisle and your local taproom’s beer list, it looks like a broad array of choices. As we’re going to illustrate here, however, the following companies are actually narrowing those choices through acquisitions and diversification. The battle for shelf and tap space is real, and these are the companies fighting hardest for it.
Brands: Budweiser, Bud Light, Bud Ice, Bud Light Lime, Busch, Michelob, Michelob Ultra, Bass, Boddington’s Stella Artois, Beck’s, Hoegaarden, Leffe, Kirin, Landshark Lager, Goose Island, 10 Barrel, Blue Point, Elysian, Redbridge, Natural Light, Shock Top, Wild Blue, Johnny Appleseed Hard Cider, Oculto, various malt liquors and flavored malt beverages.
When craft beer claims it outsells Budweiser, it means strictly the Budweiser brand. Anheuser-Busch InBev absolute decimates craft beer and imports in the U.S. Its 45% share of the U.S. market is larger than that of craft (11%) and imported beers (29%) combined, and its distribution and push for 100% “mindshare” is a big reason why. If you’re drinking it – craft beer, cider, imported lager, alcopop, etc. – A-B wants to sell it to you. It’s the big reason why competitors have tarred A-B as the supremely evil enemy, but also why they’re adopting its tactics in the marketplace.
Brands: Coors Banquest, Coors Light, Coors Light Citrus Radler, Extra Gold Lager, Hamm’s, Herny Weinhard’s, Icehouse, Keystone, Killian’s Irish Red, Magnum, Mickey’s, Miller Genuine Draft, Miller High Life, Miller Lite, Miller 64, Milwaukee’s Best, Olde English, Red Dog, Steel Reserve, Aguila, Cristal, Cusqueña, Grolsch, Lech, Peroni, Pilsner Urquell, Batch 19, Blue Moon, Leinenkugel’s, Foster’s, Molson, Redd’s Apple Ale, Crispin, Smith & Forge, Sparks, Third Shift.
The U.S. joint venture between MolsonCoors TAP, -0.66% and SABMiller SBMRY, -0.61% just throws a whole lot at the wall to see what sticks. As a result, it accounts for 26% of all beer sold in the U.S., with Coors Light alone representing 8% of all beer sales. MillerCoors doesn’t catch as much flak as A-B because it doesn’t have as massive a distribution network and hasn’t made as many acquisitions, but all those brands take up a lot of real estate.
Brands: Corona, Modelo, Negra Modelo, Pacifico, Victoria, Tsingtao
Constellation STZ, +0.78% would do just fine on its own if it could only sell its wine and spirits brands including Robert Mondavi, Ravenswood, Kim Crawford, Ruffino and Svedka Vodka. However, when the Justice Department ruled a few years back that A-B couldn’t sell products from its newly acquired Grupo Modelo here, Constellation went from being those brands’ importer and distributor to basically being their source in the U.S. That’s incredibly fortunate, as Nielsen notes Mexican beer sales in the U.S. have increased 10% by volume and 13% in dollars within the last year – similar to the growth of craft beer here.
Brands: Heineken, Dos Equis, Amstel Light, Tecate, Newcastle, Sol, Indio, Carta Blanca, Bohemia, Strongbow cider
Sure, it has only about 4% of the U.S. beer market and 8.4 million barrels of production, but Heineken USA has chosen its portfolio wisely. It has one of the strongest-selling cider brands in the nation, its Dos Equis has experienced double-digit percentage-point growth for the past four years and its flagship is one of the top 10 beers in the country by volume. It isn’t the biggest player out there, but it might be the smartest.
Brands: Pabst Blue Ribbon, Schlitz, Ballantine IPA, Old Milwaukee, Lone Star, Rainier, Olympia, National Bohemian, Old Style, Primo, Stroh’s, Stag, Schaefer, Schmidt’s, Pearl, Blatz, McSorley’s, St. Ides, Champale, Colt 45.
Its beers are brewed in either MillerCoors facilities or by contract brewers in places like Cold Spring, Minn. Its brands are mostly malt-liquor-filled placeholders until Pabst can get around to reviving them. However, it was sold for $700 million last year after fetching just $250 million in 2010. Why? Because the now California-based company rode the marketing of cheap beer to cultural cachet (and about 5.3 million barrels worth of sales) while reviving brands like Schiltz and Ballantine and re-establishing local ties. Pabst is now planning a research brewery in its old hometown of Milwaukee. With any luck, cities from Baltimore to San Antonio will see their brands restored to their former glory as well.
Boston Beer Co.
Brands: Samuel Adams, Angry Orchard, Twisted Tea, Traveler shandies, Angel City, Coney Island Craft Lagers, Concrete Beach
Boston Beer SAM, -2.65% reached 4 million barrels of production last year and, based on its growth pattern of the past five years, should size itself out of the Brewers Association’s definition of a craft brewer within three years. That said, founder Jim Koch learned from his father’s experience with breweries in Cincinnati how breweries grew, how they consolidated and how they died if they went stagnant. Koch has diversified Boston Beer into not only the company behind Samuel Adams Boston Lager, but the producer of the top-selling cider brand in the country, a laboratory for new projects and acquisitions (through its Alchemy and Science branch in Burlington, Vt.) and a nimble distribution network that can sell it all as a package. Koch may never stop considering himself a craft brewer, but he’s built his company for bigger things.
North American Breweries
Brands: Genesee, Dundee, Imperial, Labatt (U.S. distribution, owned by A-B), Magic Hat, Portland Brewing, Pyramid
Owned by Costa Rica-based Florida Farm and Ice, North American Breweries is a series of sales and acquisitions that resulted in a hodge-podge of beer brands that, quite frankly, makes about as much sense as any other on this list. Though purists argue that the craft brands in the NAB portfolio have been distanced from their home markets after their acquisitions, NAB has managed to keep it moving forward as a 2.5 million-barrel operation. It’s one of the few “craft” brewers to lose sales and market share – with production down 5.4% over the past year, but its 1.1% of the market is still more sizable than that of large craft brewers including Sierra Nevada and New Belgium, or even some importers.
Diageo North America
Brands: Guinness, Harp, Red Stripe, Kilkenny, Tusker, Bell, Serengeti, Senator Keg
We’ve been seeing a whole lot of creativity out of the Guinness brand as of late, with Guinness Black Lager and Blonde American Lager seeking new stories for the Dublin-based stout purveyor. We can understand why. Diageo’s 2.3 million barrels sold last year were down 4.2% from the year before and lean heavily on Guinness. If that brand isn’t working, it isn’t as if Red Stripe is going to pick it up. The odd part is that Guinness not only has a great craft-style story to tell from James’ Gate, but at a time when drinkers are looking for a lighter, lower-calorie session beer without sacrificing flavor, a Guinness draft clocks in at 125 calories for 12 ounces (roughly 170 for a pint) and contains roughly 4% alcohol by volume.
Craft Brew Alliance
Brands: Widmer Brothers, Redhook, Kona, Omission, Square Mile cider
The craft kids like to remind you that A-B owns a 32.2% stake in this company. We like to remind them that it’s not a controlling interest and that some of their craft heroes – Goose Island, Elysian – sold far larger stakes than that. With Widmer and Redhook bringing more than 30 years of history apiece to the table and Kona bringing roughly 20, the alliance sold more than 790,000 barrels as the ninth-largest U.S.-based brewer. It has breweries in Oregon, Washington, Hawaii and New Hampshire, and plans to expand its Portland, Ore., facility within the next few years. With all brands reporting growth last year, the alliance has shrugged off everything the haters have thrown at the “craft” portion of its name and just keeps brewing.
Brands: Shiner, BridgePort, Trumer Pils
Not everything this San Antonio company has touched turns to gold. It couldn’t make Canada’s Moosehead catch on here, it lost the contract to distribute Grupo Modelo products here and it watched as one of craft beer’s pioneering brands – Pete’s Wicked – died in its arms. That said, it’s brought Shiner out of Texas and to the masses, with that brand accounting for a huge portion of its nearly 700,000 barrels worth of sales. Its brands made it the 10th-largest U.S. brewing company in 2014, placing it ahead of fast-growing Lagunitas and Deschutes. In beer terms, that’s huge.
Duvel Moortgat USA
Brands: Duvel, Brewery Ommegang, Boulevard, Firestone Walker
When Belgian brewer Duvel bought Cooperstown, N.Y.-based Ommegang in 2003, it seemed like a perfect match of like-minded brewers. When it acquired Kansas City’s Boulevard a decade later, it seemed like the best option for a brewer looking to keep the craft spirit of the brewery alive. When it bought Paso Robles, Calif.-based Firestone Walker this year, it looked like a regional strategy.
Already the 18th-largest U.S. brewing concern with nearly 250,000 barrels worth of sales between Duvel, Ommegang and Boulevard products, it just nearly doubled that by purchasing 200,000-barrel Firestone Walker and its well-regarded Union Jack, Wookey Jack, Double Jack, Velvet Merlin and Parabola beers. Beer Marketer’s Insights believes the Firestone Walker deal is worth about $250 million, but its effect on the craft beer landscape may be immeasurable. Duvel has now made itself a huge player in U.S. craft beer, and folks who considered it the “good” buyout company may want to ask themselves where it goes from here.