The Beer Industry’s Perfect Storm

Among the many fallouts of this year’s pandemic lockdown are spikes in alcohol demand and a supply-chain shortage of aluminum cans. These are affecting the ability of many breweries – both small and large alike – to package their beloved suds for retail sale, and it is changing the look of liquor store shelves across the nation.

I remember back to early spring, rushing to get things ready for opening weekend at The Whitebrier. Usually March is the time of year we start to see some life down at the beach again. We celebrate the end of a long winter with big beer-drinking events like Shop-A-Holics Weekend, March Madness, St. Patrick’s Day, and the Stone Harbor Shiver.

This year, however, the only big beer-drinking events were taking place on the couch, virtually hanging with a few friends on Zoom. Bars and restaurants were forced to close.

The instantaneous and unforeseen shift to off-premise consumption meant that breweries and distributors were left with millions of gallons of beer that could never be sold before expiration, and sadly it had to be dumped.

Simultaneously, Americans on lockdown became an increasingly drunker population, with panic buying and unemployment adding to the demand for canned and bottled beer (and soda). Normally more than half of all beer brewed in the U.S. is served via draft, and that volume had to go somewhere.

Can manufacturers already had been struggling to keep up with demand in the past few years. The popularity of hard seltzers like White Claw and Truly, as well as increased use of cans by craft breweries, meant there were more cans on the shelf than ever before.

Aluminum cans have many benefits over glass bottles: durability, lighter weight, easier recycling, and cheaper price. They are also taking the place of plastic soda bottles, which are obviously much worse for ocean pollution.

The issue is not with raw materials; it is simply the sheer volume that needs to be produced. Manufacturers like Ball Corporation in Colorado and Crown Holdings in Philadelphia are two of the nation’s largest producers and already have started building new production facilities, but they will not be done until next year. In the meantime, unless bars and restaurants can open at a fuller capacity, the demand for cans might not be able to be met from domestic sources.

While Anheuser-Busch has its own can-manufacturing subsidiary and hasn’t had a major supply issue to this point, other brewers have had a much more difficult time getting packaging. In order to keep its core brands on the shelf, MillerCoors has temporarily discontinued some of the smaller, less popular brands within its portfolio. Some smaller brewers that have invested solely in canning lines rather than bottling lines might not make it through the pandemic without the ability to sell kegs or use their canning lines. Not to mention, lag times in can deliveries make it difficult to time batches of beer, and offer the freshest product. Some brewers have had to wait more than four weeks for a shipment that normally would have taken a week.

Looking globally for cans is one other possible solution. However, President Donald Trump’s tariffs on certain countries that produce aluminum and/or aluminum cans make importing materials more expensive than they used to be. And as demand increases, so will price.

My hope is that this pandemic comes to an end soon and we can get back to sipping pints inside a bar with our friends and watch some football. The good news is that this is a problem of being too busy, and not too slow. Those beer recipes you love will not be lost and will continue to be brewed once we get to the other side. We just have to pray that we don’t have another lockdown. Maybe this will actually help reorganize the beer industry a little bit and bring back the concept of a flagship beer.

While you might not be able to find your favorite brew on the shelf in the coming months, and have to shell out a couple extra coins per six-pack, it could be worse: They could have banned beer altogether. As long as we are not in prohibition, I’ll consider it a win.