“2022 is going to be a make-or-break year for many breweries,” said Bart Watson, Brewers Association economist. The overall beer market grew by 1 percent in 2021. Craft brewers collectively produced 24.8 million bbls of beer and realized 8 percent growth in 2021, increasing craft’s overall beer market share by volume to 13.1 percent, up from 12.2 percent the previous year. 

This year continued to challenge the industry through inflation, supply chain gaps, pricing problems, increased competition from both brewers and other alcohol categories. The make-or-break moment depends on whether a brewery’s focus is at retail scan or on-premise sales. According to Craft Brewing Business, Watson recently released a teaser to the BA’s upcoming 2022 midyear beer market overview:

“To frame the data in some context, total beer volume sales were down 6.5% in the first half of the year, and dollar sales down 2.0% versus a year ago (IRI Group, total U.S., multi outlet with convenience (MULO+C) +total liquor). This shouldn’t be overly shocking given that, A) the comps for packaged sales in the first half of 2021 were clearly still elevated (10% above 2019 by volume and 20% in dollar sales), and B) the on-premise in the first half of 2022 was much stronger than the first half of 2021.”

Even with an optimistic outlook, retail chain packaged products have been an issue for craft beer for some time. Scan continued to struggle in the first part of 2022 (down less than 1 percent), “Chain packaged independent craft hasn’t grown over the past three years,” said Watson in his report. “And with ready to drink (RTD) spirits and a variety of other fourth category products coming for craft’s shelf space, it’s hard to see a lot of momentum for changing that trend anytime soon.”

With the retail shelves being so stacked, craft brewers can look at the silver lining by recouping with a shift to draught and on-premise product. “We have a few hints from other data sources, such as retail census data, that shows foodservice and drinking places sales up 15% in real terms versus last year (24% before controlling for inflation). Similarly, Open Table reservations were only 6.2% below 2019 in the first half of 2022, versus 30.5% below 2019 levels in the first half of 2021.,” said Watson.