The Year in Beer 2023
All scribblers come to late December reflecting on the year that was—in music, politics, movies, or, in our case, beer. Most of the recaps of 2023 have struck a gloomy note. Once again, except for imports, the beer industry had another rough year in sales. Bart Watson, the Brewers Association economist, announced two weeks ago that “all signs point to production being down in 2023” in the craft beer segment. For the first time in history, an import is now the best-selling American beer. Worse, we lost some very good, celebrated, and in at least one case, historic breweries to the rough economic climate.
I am going to cut against conventional wisdom, however, and make the case that 2023 was hard but full of good signs. Reading the tea leaves, I think this may have been the year we came to an inflection point that will redefine the way we think about beer. Industries go through good times and bad times as a matter of course, but periodically there are moments of transition, when an industry pivots. We still don’t have many electric cars on the road, to cite an analogy, yet the entire automotive industry has shifted course because of them. It has been a rocky transition, but absolutely no one thinks about cars the same way in 2023 as they did in 2013. Beer may be in a similar place.
We’ll dig into that, but before we get into the heavy business side of things, let’s do the fun stuff first.
Best in Beer
The three years of Covid forced breweries into hunker mode, but in 2023 they were finally able to get back to creativity. Easily my favorite new trend is American lagers, led by West Coast pilsners. It’s a fantastic style that combines the aromatics and fruitiness of American hops with the crisp drinkability of pilsner. They aren’t the grinding IPLs of yesteryear, either—they’re legit, eminently drinkable pilsners, just made with local hops and a few American hopping tricks.
Portland’s Fracture brewing made my favorite version of a WC pilsner, and I discussed it in August. Just to orient us in the new potential, here was my description: “But almost immediately something interesting happens. The hops seem to evaporate, revealing the pilsner underneath. Like any pilsner, it is lightly malty, crisp, and dry. Trace amounts of hop flavor linger, but by the time you swallow they’ve transformed almost entirely into aromatics. The hops are ‘fine’ in the European sense—very soft, nothing sharp or grating.”
For years, I’ve been excited to see the emergence of recognizably American lagers, and this is the first fully-formed example I’ve seen. A juicy pilsner isn’t the only way to go, however—we’re also seeing American “lager hops” emerge, and my favorite is Lorien. The Pacific Northwest tends to lend an expressive, punchy quality to hops grown in its valleys, even if they’re European in origin. One of the only really good lager hops to come out of the region is Sterling, a Saaz descendent—and Lorien’s mother. Lorien is elegant and soft, with fine bitterness (that word again) a wildflower/hay freshness backed by a dash of tang and spice. Saturate a pilsner with a bit of Lorien in the whirlpool and maybe conditioning tank? Yes, please.
Hops were a big bright spot in general. A lot of the attention lately has been focused on strange new hop products, but breweries are actually more excited by new varieties. There are tons out there—Vista, McKenzie, Triumph, Nectaron, HBC-586, just-released Alora to name a few. This year I fell in love with coconutty, mangosteeny Talus as well as the hop that knocked me out during fresh-hop season, Luminosa. It’s all sunshine and tropical fruits, but soft and gentle rather than punchy and spiky. These hops will scent and flavor IPAs in the years to come—and who knows, maybe the pilsners as well.
I’ll leave my fave beers of the year for a separate post, but I want to give a final shout-out to the brewery whose memory continues to captivate my mind: Oklahoma City’s Skydance. When I spent a few days in Oklahoma over the summer (Oklahoma in July and Budapest in January—do I know how to pick ‘em or what?), I really didn’t expect to find a head-turning brewery. Oklahoma punched way above its weight, though, and The Big Friendly, Heirloom, Marshall’s, and Bierkraft were all quite impressive. But Skydance was on another level. Here’s how I described Jake Keyes’ flagship IPA, Fancy Dance:
“It is deeply tropical, and the flavors and aromas have a bell-like quality to their intensity. They’re not muddy or over-packed, and there’s absolutely none of the off-flavors intense IPAs can have—no hop burn, no vegetal, chlorophyll chalkiness. They’re exactly what people want when they order a modern IPA—tons of flavor and aroma, that deeply juicy quality, but a very approachable, delicious beer that doesn’t go to 11.” Jake’s IPAs are hazyish, and they point to a direction I think IPAs have been headed for a while—not quite East Coast, not West Coast, but very American. It’s a brewery to watch, not just for Sooners, but the whole country.
(I was also riveted by what I discovered in Biddeford, Maine, but you’re going to have to wait until next week to hear about that.)
A Year of Transition
There’s just no way to soft-pedal the news about the health of much of the beer industry. Very little is going well in the broad market we call “beer”—which includes a bunch of stuff that’s not beer. Imports are still rocking, and Modelo has displaced Bud Light as the country’s favorite beer. (That was going to happen even before Bud Light faceplanted.) Flavored malt beverages, excluding seltzers, also had a good year. But all the other segments—domestic lagers, craft, and seltzers, sank. Depending on how you count these things, that’s something on the order of three-quarters of the “beer” market that went down.
Little breweries definitely had a very rough year. Closures almost kept pace with openings, including some that shook locals: Anchor, Metropolitan, Ecliptic to name three. Draft sales were down, and the taproom, that magic bullet breweries once reliably used to shore up revenues, is no longer a sure bet. Costs are up for breweries across the board, but not pricing, which puts nearly every small-scale brewery in a worse place than it was in 2019. I speak to a lot of brewers over the course of a year, and the overwhelming sense is that things are very scary right now.
Despite all that, I see a number of things that give me hope. Prior to Covid, we were living in an era of magical thinking. As breweries spun out weirder and weirder beers, more and more beers, and sent prices through the roof, that made me nervous. These beers were generating a lot of profit, but they appealed to a very specific audience. Breweries nevertheless went all-in on a business model that featured maximum prices and maximum churn. Glancing back through history, I don’t know of any example of that being the healthy state of a market for beer. When beer is doing well, it’s because breweries are deepening connections to customers, and offering reliable, tasty, and relatively cheap social lubricants. Historically, people have been attracted to beer because it is reliable, and not a gamble. For more ways than one, I feel like breweries in the teens were offering unsustainable sugar highs, but that is all done now.
This is the inflection point I mentioned in the intro. For most of my adult life, small breweries have pitched themselves as something different than larger ones. They defined their beer as “craft,” and created an us-and-them mental model. I don’t think people under 30 relate to beer remotely in these terms. Big breweries make light lagers and seltzers and non-alcoholic beers, and you know what, small breweries do, too. Older drinkers may well point out that Level’s corn-grist Bad Hombre has more toasted flavor than Pacifico’s corn-grist lager. It does, but at this point such an observation looks needlessly pedantic. Younger drinkers are brewery agnostic—and maybe even brewery-blind. When you have 10,000 of the damn things, how do you expect a younger drinker to keep track of them? They are as susceptible to the pull of loyalty as consumers in any era, but they don’t premise their love on the size or ownership of a brewery. It’s one reason beers like Modelo and Guinness are suddenly cool again.
Craft beer has found itself in a box of its own making. For years, breweries focused on the kinds of products that ultimately didn’t appeal to a very broad audience. Smoothie sours and 10% triple IPAs may have goosed taproom can sales, but they didn’t broaden the market. I have no numbers to back this up, but it may actually have alienated consumers a ring or two outside the target audience who were never brought into craft beer. Looking forward, many excellent breweries are going to survive the next decade, and they’ll do it by widening their focus, offering excellent beer, and building brand loyalty—pretty much what good breweries have always done. As I argue below, there’s a large, untapped market out there, but breweries won’t access it by sticking to the same “craft beer” playbook that worked in the past.
Beyond the Beard
By happy chance, I managed to visit Latino-, Native-, and Black-owned breweries this year. It opened my eyes to a reality I know many have been aware of for years: many communities in the U.S. haven’t started drinking the beer of small breweries yet. Well over 90% of the small breweries are owned by White Americans, and while some of them have done wonders at reaching out to underrepresented groups, craft beer is still overly focused on White consumers. In Chicago, Rich Bloomfield, a Black co-owner of Funkytown, told me: “You walk into a craft brewery and you’re going to see zombies and skeletons. People I know don’t see themselves in there.”
To put this in stark numbers, White Americans only constitute 58.9% of the population. That means fewer than a third are White men. In places like Chicago, where I met Latino and Black brewers, the White population is just a third of the city. Similarly, in many parts of the country, women are underrepresented among beer drinkers.
There is massive potential for growth for small breweries. Big breweries have done a far better job of catering to people of color (though not women) and they’ve reaped the rewards. I mentioned the four beer segments above, and among them, craft is the smallest (somewhere between 12-20% of the market depending on how and what—dollars or barrels—you count).
These groups offer small breweries huge runways for growth—and they’re taking it. The Pink Boots Society has helped many women enter the industry, starting the process of de-gendering beer. In places like Portland, where Pink Boots was founded, women drink beer in the same proportion as men. This past year, a consortium of Black brewers founded the National Black Brewers Association to elevate Black brewers the way Pink Boots did for women. This follows the Garrett Oliver-led Michael Jackson Foundation, that actually funds education for people of color.
Finally, we’re seeing a lot of energy at the grassroots level. One of my favorite Instagram accounts is women-, Latina, and Queer-owned Lady Justice in Aurora, CO. It is playful and very charming, and co-owner and former educator Betsy Lay has become one of the most eloquent voices for inclusion. Lady Justice is far from the only example, but a good one in illustrating how breweries are now pushing past the formerly invisible barriers that constrained the industry.
All of this is ample evidence that small breweries are already beginning to widen their scope and reach out to these new drinkers—and that will have profound implications in the coming decade.
(To pre-rebut any trolling, let me note that celebrating communities currently disconnected from beer doesn’t in any way detract from existing breweries. It’s like a candle flame—you can light another candle without dimming the first candle’s light. And, if you want to be very crass about it, you could even say it’s just good business. In this case dollars and inclusion just happen to be playing for the same team.)
To conclude, we have to acknowledge that the beer industry is currently facing a number of very real challenges, and some will fail along the way. Yet it was back on its feet in 2023 and building the groundwork for future growth. For consumers, it was the first year since Covid that felt normal, with all the virtuosity, discovery, and mastery that characterizes beer when it’s firing on all cylinders. In short, beer was fun again in 2023.
On to ‘24–