Mar 30, 2022 - Business

Owner of soon-to-close Tin Whiskers predicts a craft beer reckoning

Illustration of a mug of beer, with a sad face in the foam
Illustration: Sarah Grillo/Axios

Minnesota's craft beer scene has lost a handful of breweries over the years, but the recent announcement that Tin Whiskers would close shop in May raised eyebrows.

  • That's because Tin Whiskers is one of the 25 largest breweries in Minnesota and has a strong following for its infused beers, which can be found on liquor store shelves, at restaurants and in a downtown St. Paul taproom.

Why it matters: The craft beer industry employs more than 8,000 in Minnesota and generated $1 billion in economic impact in 2019, according to the University of Minnesota Extension.

State of play: The number of breweries in Minnesota has exploded from 39 in 2012 to more than 200 today, and more continue to open, even as the market for craft beer has declined.

What they're saying: "A lot of people are getting in that think it's easy — easy money," Tin Whiskers owner Jeff Moriarty told Nick. "I feel like a bubble is coming — a reckoning is going to happen."

Between the lines: More breweries are fighting for a smaller piece of the pie, but that's not the only problem.

  • Costs are rising for all kinds of materials. Moriarty said his canning costs spiked 127% last year over the span of 12 months. That adds $9 to the costs of producing a case of beer.
  • COVID restrictions and waves of the virus wiped out or reduced revenue from taprooms and restaurant sales, which are much more profitable than retail sales.
  • Meanwhile, downtown St. Paul remains quiet as most workers are still at home. Just a few blocks away, Stacked Deck Brewing closed in October.

Moriarty and his board talked for a long time about the decision, but ultimately he didn't want to try to resuscitate the brewery.

  • He had to go back to work as an engineer part-time four years ago, "just to make ends meet."
  • "At the end of the day you're burned out and you're tired, and you're emotionally exhausted," he said. "It's just not as appealing."

What's ahead: The Minnesota Craft Brewers Guild is lobbying at the State Capitol to allow breweries to sell six-packs directly to customers, said Bob Galligan, the group's director of government and industry relations.

  • Galligan said to expect price hikes as brewers deal with added expenses.
  • "I think the consumer somewhat knows that but I don't know that they are fully grasping that pints are going to be a little bit pricier," he said.
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