Apr 5, 2022 - Economy

Craft beer industry sees rebound but 2022 is a "make-or-break year"

Low-angle view of stack of kegs containing craft brew beer from microbreweries

Smith Collection/Gado/Getty Images

American craft brewers rebounded from the pandemic with 8% annual growth and 24.8 million barrels of beer in 2021, new data shows.

State of beer: The increase easily exceeded the overall beer market, which grew 1% in 2021, as taprooms and brewpubs returned to life as public health restrictions eased.

  • Craft beer — made by small, independent breweries — is now 13% of the overall beer market, up from 12%, according to a report released Tuesday by the Brewers Association, the Colorado-based trade group.
  • 9,069 breweries were operating at the end of the year, and openings exceeded closings nearly four-fold.

Yes, but: Craft beer rebounded higher because it tumbled more than the overall beer market during the pandemic as small brewers struggled to shift to packaging and distributing their beer to compete with mega-brewers like Anheuser-Busch and Molson Coors.

  • In 2020, overall beer production fell 3% where craft dropped 10%.
  • Moreover, smaller brewers are expected to face even greater supply chain and inflation pressures looking forward.

What they're saying: Bart Watson, the association's chief economist, expects craft beer production to exceed pre-pandemic levels this year, but not all will make it.

  • "Even with a bounce-back year, many breweries are still struggling," he told reporters. "2022 is going to be a make-or-break year for many breweries."

The intrigue: Athletic Brewing, a nonalcoholic beer maker, made the jump to No. 27 on the list of the top 50 largest craft beer companies as health-conscious consumers look for alternative beverages.

The bottom line: The craft beer industry is maturing after remarkable growth since 2010 and facing more competition than ever.

  • "It's not the cool kid anymore," Watson said, adding that a mature industry needs to constantly look to reinvent itself.
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