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Monday, 30 September 2013

More breweries in a declining market

According to the annual cask ale report compiled by Pete Brown, cask ale outperformed the total beer market by 6.8%. So party time? Er, not quite. What actually happened is that the total beer market declined by 7.9% in 2012, but real ale declined by only 1.1%. While it's good that real ale is surviving the recession better than keg beers and lagers, it's still in decline. The market share of real ale is increasing merely as a percentage of the total, declining ale market: it is now 55% of the total - the remaining 45% being smooth and keg. I'm not sure how an overall decline can be seen as good news, even if it is a lesser decline than other beer types; the CAMRA newspaper, What's Brewing, is to my mind unjustifiably optimistic.

At the same time, the latest issue of the Good Beer Guide shows that the number of breweries has increased to more than 1,150, with almost 190 opening last year. The contradiction of ever more breweries chasing a declining market cannot continue indefinitely, and the first casualties are likely to be breweries. Real ale nibbling into keg and lager sales will only postpone this outcome, unless the decline in real ale sales rectifies itself. I can't see this happening until the economy improves, assuming it does, and people's job security and standards of living begin to recover, which is unlikely in the near future.

I doubt there would be a big bang of breweries going bust; more likely there would be a gradual loss of smaller, less profitable ones after a struggle to find outlets for their products. People don't tend to abandon their dreams lightly, so I'd expect it to be a slow process. I hope I'm wrong and we do get more of a recovery.

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