THE BLOG
03/13/2013 02:28 pm ET Updated May 13, 2013

The Beer Market Is as Healthy and Competitive as Ever

Wenonah Hauter's March 5 piece on consolidation in the beer industry was a game attempt to wedge brewers like us into a food-industry narrative she's written on extensively, but the comparison simply doesn't hold up under scrutiny.

As anyone who has visited a restaurant, convenience store, liquor store or supermarket in the last few years can attest, the suggestion that there is less consumer choice available to beer drinkers today is absurd. There are more brands, brewers and styles of beer available to U.S. beer drinkers today than at any point in history, with new breweries opening almost daily.

There was a time, not long ago, when most fine restaurants offered, perhaps, three domestic beers and two imports. Today, they have extensive beer lists that rival their wine selections. Convenience store aisles that once contained only a few mainstream light lagers contain dizzying selections of pilsners, porters, stouts and wheat beers. And local breweries in almost every city in the country are finding a market for their products.

Hauter acknowledges this, indirectly, noting the more than 2,000 craft brewers currently operating, in addition to the significant players such as ABI, MillerCoors, Heineken USA and Pabst, the No. 5 U.S. brewer, who went unmentioned.

She makes it clear that her real issue isn't choice, but the results of those choices. She doesn't like that craft beer represents 7% of dollar sales (even though that total has been expanding quickly). It's true that MillerCoors and ABI do sell a lot more beer than the other players in the industry. But the fact that some brands sell more than others is not a conspiracy; it's the market at work.

There may be markets where consolidation has limited consumer choice, but beer isn't one of them. This is presumably why so much of Hauter's article focuses on non-beer examples culled from her recent book, which focuses on the impact of food-industry consolidation on both farmers and consumers. And, indeed, it is troubling if, as Hauter reports, poultry farmers receive only $0.25 per 12-piece chicken bucket.

But, as brewers, we don't work with chicken farmers. We do work with barley and hop farmers, who have enjoyed unprecedented demand and high prices in recent years partially due to the explosion of new U.S. breweries.

So, if the ills Hauter is most concerned about are decreasing consumer choice and the welfare of farmers, I'm not clear I understand why she's chosen to spotlight an industry that currently boasts unprecedented consumer choice and record crop prices. By those metrics, the beer industry is as healthy and competitive as ever.