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Craft Brew News - 05/24/19
(brought to you by Brewbound.com)
Texas Senate Approves Beer To-Go-Sales Measure
Texas craft brewers’ efforts to legalize beer-to-go sales is closer to passage than ever before.
On Wednesday, Texas Senators unanimously passed sweeping legislation to maintain operations of the state’s alcohol regulatory body, the Texas Alcoholic Beverage Commission (TABC), along with several changes to the state’s alcoholic beverage code, including an amendment that would permit a majority of the state’s manufacturing breweries to sell their offerings for off-premise consumption.
The measure now returns to the House of Representatives for concurrence. Those familiar with the process expect the measure to easily pass through the chamber and then advance to Gov. Greg Abbott’s desk.
Texas is the only state in the country that does not allow beer-to-go sales at manufacturing breweries, but the state does allow brewpubs, wineries and distilleries with similar permits to sell their products for off-premise consumption.
If passed, the bill would allow consumers to purchase up to one case of beer (288 fl. oz.) per day from the state’s manufacturing breweries, beginning September 1, 2019.
The advancement of the beer-to-go sales bill comes a week after the Wholesale Beer Distributors of Texas (WBDT), a powerful lobbying group, agreed to back the measure. In February, the Texas Craft Brewers Guild and Texas’ other wholesaler group, the Beer Alliance of Texas, reached a “stakeholder agreement” on to-go sales.
The effort to reform Texas’s direct-sales laws date back to 2015 when Dallas-based Deep Ellum Brewing sued the TABC, arguing that manufacturing breweries were at a competitive disadvantage. Deep Ellum Brewing founder John Reardon called the Senate’s passage of the beer-to-go amendment “bittersweet.”
Addressing Rumors, Stone CEO Says Distribution Business is Not For Sale
Despite months of rumors to the contrary, Stone Distributing Company (SDC) is not for sale.
In a memo to employees last week, Stone Brewing CEO Dominic Engels sought to quash talk that the San Diego craft brewing company was attempting to offload its distribution business.
“Rest assured of our commitment to SDC,” he wrote.
According to Engels, Stone Distributing remains “a key piece of Stone Brewing” and a “critical” piece to the company’s success in its largest market, California. He added that Stone is “committed to the continued growth of SDC.”
Indeed, Stone Distributing has grown into one of the largest craft beer wholesalers in the San Diego market. According to a March profile in San Diego Magazine, the more than two decades old wholesale business sells about 4.5 million cases of beer to more than 12,700 unique accounts annually. The business, which employs more than 300 workers, covers a 40,000-square-mile service area. Beyond selling its own brands, Stone’s portfolio includes about 45 different craft brands, including popular California craft breweries Modern Times, Russian River, and Port Brewing, as well as offerings from national brands such as Boulevard Brewing, Brooklyn Brewery, Cigar City, Oskar Blue and Victory Brewing.
So where did rumors of a sale originate? Engels pointed to large wholesalers.
“In times of uncertainty, fueling rumors is common practice by large wholesalers who look to undermine retailer confidence in the alleged seller,” he wrote. “Given the success of SDC as the largest independent craft beer distributor, whenever there is activity in the market, SDC is a prime target.”
Study: US Beer Industry Supports More than 2 Million Jobs
The U.S. beer industry was responsible for creating more than 2.19 million jobs that paid more than $101 billion in wages and benefits in 2018, according to a joint study released today by industry trade organizations the Beer Institute (BI) and the National Beer Wholesalers Association (NBWA).
The biennial “Beer Serves America” report is “a snapshot in time” of the industry’s current health and provides the industry with a tool in their advocacy efforts, NBWA president and CEO Craig Purser told Brewbound.
“Part of what we’re trying to do by rolling this out is just remind people that this small industry is really the little engine that could,” he said. “It provides a lot of economic contribution and a lot of groceries on people’s tables across America.”
According to the report, U.S. beer companies and wholesalers employ more than 200,000 American workers. Each of those jobs creates 31 additional full-time equivalent jobs in adjacent industries.
US Lifts Aluminum and Steel Tariffs on Canada, Mexico
Nearly a year after imposing aluminum and steel tariffs against Canada and Mexico, the Trump administration today officially lifted levies imposed upon the two longtime trade allies.
On Friday, President Donald Trump announced plans to remove the tariffs — 25 percent on foreign steel and 10 percent on imported aluminum — as the three countries work toward the passage of a renegotiated North American Free Trade Agreement (NAFTA), now called the U.S.-Mexico-Canada Agreement. In turn, Canada and Mexico today lifted retaliatory tariffs against U.S. goods.
Ending tariffs on steel and aluminum imported from Canada and Mexico marks a significant moment for the beer industry, as about 43 percent of aluminum used by U.S. beverage companies comes from Canada, according to Washington, D.C.-based trade group the Beer Institute (BI).
Nevertheless, BI president and CEO Jim McGreevy said tariffs on aluminum and steel, which amount to a $350 million annual tax on the industry, need to be completely repealed.
Although President Trump has eased the tariffs on imported goods from Canada and Mexico, he has also escalated his trade war against China by increasing levies against $200 billion worth of Chinese goods. As such, the tariffs on several products being imported from China, including brewing equipment, have increased from 10 percent to 25 percent. In turn, China has threatened to raise its tariffs on $60 billion of U.S. goods beginning in June.
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