Apr 25, 2020 - Economy & Business

Coronavirus shutdown could leave millions of gallons of beer wasted

Photo: Olivier Douliery/AFP via Getty Images

The coronavirus pandemic forced event centers, sporting venues, bars and restaurants to close across the U.S. — leaving millions of gallons of beer unused and at risk of going stale, The Wall Street Journal reports.

The big picture: A variety of industries are struggling to deal with excess stock as the virus continues to take its toll, per the Journal. Farmers are dumping food that would've gone to now-closed restaurants, while airlines hunt for places to park their idled fleet, and commodity traders search for floating supertankers to store excess crude oil.

Normally, brewers would be gearing up for a busy season as summer nears, but they've already missed out on the NCAA's March Madness basketball tournament and St. Patrick's Day.

  • Brewers and distributors will also take a hit from the postponement of Major League Baseball's season, the 2020 Tokyo Olympics and European soccer.
"This was the absolute worst time for this to happen for draft beer. We have never seen an interruption like this where everything freezes in place."
— Craig Purser, CEO of the National Beer Wholesalers Association, to the WSJ

The state of play: The unsold or expired beer could cost the industry as much as $1 billion, per the Journal.

  • Brewers are struggling to figure out what to do with the excess suds. In March, roughly 10 million gallons were abandoned in venues, according to an NBWA estimate.
  • Large quantities of beer can't be dumped into the water stream because environmental regulations say it can negatively impact the pH balance, reduce oxygen and produce bad bacteria.

The impact: Brewers and distributors are still debating who will absorb the cost, which could be devastating for small and locally owned businesses.

  • Guinness maker Diageo PLC, Anheuser Busch InBev SA and Modelo owner Constellation Brands Inc. are among the businesses that have pledged to share the cost of undrunk beer with distributors, the Journal writes.

Go deeper: America stocks up on alcohol during coronavirus pandemic

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