The Session No. 67: How Many Breweries?

This month’s Session* topic is hosted by Derrick at Ramblings of a Beer Runner who begins with the following statistics:

There’s been much cheering and fanfare reverberating throughout the brewing community about the latest brewery numbers recently released from the Brewer’s Association, who counted exactly 2,126 breweries in the United States.  To put that into context, you have to go way back to 1887 when the United States had that many breweries.  It’s an astonishing 47% increase from just five years ago in 2007 when the tally was a mere 1,449, despite the United States slowly recovering from a serious recession over this period.  And according to the Brewers Association, another whopping 1,252 breweries are in the planning stages.

Since Derrick announced the topic at the end of August, the number of breweries in planning has risen to 1,303.  With those stunning figures in mind, Derrick asks this short, but complex, question:  “Where is it all going?” More specifically, Derrick asks us to guess, using whatever methodology we deem appropriate, the number of breweries the Brewer’s Association will count five years from now in 2017 (and why).

Thanks for the easy question, Derrick.** 

Here’s the deal. I’ve got no insider info, no special formula and no idea how any given brewery is doing, other than a couple with some nice expansion plans. I’m in no position to be making anything other than a generally uneducated guess.  But hey, that’s The Session topic for this month and I’m not about to duck it.

Let’s first take a look at Montana.  Montana now has 36 distinct breweries,*** counting Desert Mountain Brewing which is close to opening in Columbia Falls.  Another brewery is in the development stages in the one remaining “large” Montana city which does not yet have a brewery (we’re working to track down that info).

Six have opened in 2012: Uberbrew (Billings), The Front (Great Falls), Philipsburg Brewing (Philipsburg), Wildwood (Stevensville), Outlaw (Belgrade) and, soon, Desert Mountain.  Two others opened new locations (Angry Hanks and Himmleberger, both in Billings).

While Philipsburg Brewing Co. and Desert Mountain fill a gap, being the only breweries in those small towns, the rest represent at least the second brewery to open in their respective cities.  In Uberbrew’s case, they’re the sixth.

In 2011, we saw four new breweries open: Bowser (Great Falls), Higherground (Hamilton), Draught Works (Missoula) and 406 Brewing (Bozeman).  If you’re math-challenged, that’s 10 new breweries opening in about 1.5 years. 

The rise in the number of Montana breweries has paralleled the rise throughout the country. The presence of several established breweries in any given location does not seem to be a deterrent, suggesting the market isn’t reaching any sort of saturation point. Still, Montana is No. 2 in breweries per capita for a reason – we don’t have very many people in this gigantic state. That does present some limitations.

I don’t know how many of the 1,303 breweries-in-planning are in Montana.  The last time I asked the Brewers Association for that info, they did not respond. Still, I don’t think we’ll see six more breweries open in Montana in 2013.  Ten new breweries in 1.5 years in a state like Montana is huge growth.  Montana isn’t done adding breweries by any stretch, but I don’t think we’ll see growth at quite the same pace.

What will we see in the next 5 years in Montana?  Here are my predictions:

  • Montana will raise the barrel limitation for on-premise tap rooms either in 2013 or 2015. (What worries me is what some breweries may be willing to trade in order to get there, but that’s a topic for a different day.)
  • Two to Three current breweries will pass through the 10,000 barrel, limit, joining Big Sky as the only current brewery with that production level. 
  • Three current breweries will at least triple production, thus significantly increasing market presence. 
  • Three current breweries that do not currently package beer (other than kegs) will begin doing so and at least one of them will be exclusively in cans.
  • One brewery will close. 
  • Montana will add breweries at the rate of an average of two per year, reaching 45 breweries by September, 2017 (36, add 10, subtract one = 45).

As for the rest of the country? I see no reason to think we won’t continue to see nice growth in the craft beer industry, though I have trouble seeing it continue at the current rate.  Some markets are likely to reach a bit of a saturation point. Some states are finally opening up their laws for better beer and easier permitting. There’s sure to be some temporary ingredient shortage that will push the pause button on a few.  I don’t think the number will double to 4,252, but a healthy 50% increase isn’t out of the question.

Thus, the number of breweries the Brewers Association will count in September, 2017 is: 3,189.

What are your predictions? Leave them in the comments section below and we’ll check back in 5 years.
*Today is the first Friday in September which means it’s time to take part in The Session, a collective effort of beer bloggers around the world to write on a common topic once each month.

** That’s a touch of sarcasm, in case you’re a new reader.

*** “Distinct” brewery means I’m not counting multiple locations of the same brewery (i.e. Kettlehouse) or satellite tap rooms which do not brew their own beer (i.e. Flathead’s and Tamarack’s Missoula taprooms).  I’m still confused how to count Bones Brewing in Billings and have not included it in this number.