Craft breweries face historic slowdown
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The craft brewing market is going flat, including in Central Ohio.
Why it matters: With three straight years of negative production, the once-booming industry is struggling as market saturation and shifting drinking habits reshape the industry.
The big picture: The number of small independent breweries operating in the U.S. decreased in 2024 for the first time in 20 years, according to the latest Brewers Association data.
- Craft beer production hit 23.1 million barrels nationwide — a 4% decline from 2023 and the largest drop in industry history outside the pandemic.
Zoom in: Openings in Ohio continue to outpace closings, but 2024 had the tightest margin between the two in more than a decade, Ohio Craft Brewers Association deputy director Justin Hemminger tells Axios.
- We said goodbye to several local breweries last year, including Taft's, Goodwood, Pretentious, Random Precision, scene veteran Smokehouse and the short-lived AI-powered Species X.
- This is also the first year without a Columbus Beerfest, following a nationwide trend.
Yes, but: Hemminger says the decline in beer production doesn't mean "absolute doom and gloom." It also signals brewers moving toward alternative products to meet consumer demand.
- Case in point: Seventh Son is producing seltzers, cold brew coffee and hemp-derived THC beverages, and Land-Grant has a line of hard ciders.
What he's saying: "One of the strengths of the small brewery business model is the ability to quickly pivot to meet shifts in customer preferences," Hemminger says.
Between the lines: The national numbers also represent a maturing and highly competitive marketplace, says Matt Gacioch, the national association's staff economist.
- "In a mature market, not every year is going to be defined by substantial growth," Gacioch said in a statement.
What we're watching: The 2025 outlook for the craft beer industry doesn't favor a rebound. Small brewers are being hit especially hard by tariffs on equipment, kegs, aluminum cans and ingredients, such as hops and grain.
The bottom line: "This may be the most challenging time to run a small business in recent memory, no matter what your product is," Hemminger says.