How The Pandemic Created A Billion-Dollar Stale Beer Crisis

How The Pandemic Created A Billion-Dollar Stale Beer Crisis

As craft beer was embraced as an affordable luxury by many Americans in recent years, the number of breweries has exploded. However, that segment of the industry, as well as traditional brewers, are taking a massive hit during the current coronavirus pandemic.

By some estimates, unsold and expiring beer could result in $1 billion in losses.

On a wide scale, the problem is spread out across the country, with millions of gallons languishing in places that were popular and then suddenly no longer inhabited, including stadiums, concert halls, restaurants, and bars.

tops of beer barrels
tops of beer barrels

Bars were forced to close ahead of two notable drinking occasions — St. Patrick’s Day and the NCAA basketball tournament, also known as March Madness — and brewers are scrambling to get their kegs back to drain the stale beer and fill with fresh beer in anticipation of reopening. One industry association released an estimate that beer companies have about 10 million gallons of product — almost a million kegs — abandoned in venues just in March.

Although craft brewers operate on a much smaller scale than traditional brewing companies, they haven’t been immune to the problems.

In Charleston, SC, for example, many brewers are poised to dump kegs that are going stale in distributors’ warehouses. This includes producers such as COAST Brewing Company, which has been operating for 13 years. It would be the first time COAST has faced the possibility of disposing of product that is no longer considered fresh enough to sell.

Because freshness is at the core of beer marketing, especially in craft beers, most brewers see purging the aging inventory as their only option. However, the loss of sales isn’t their only financial issue. Dumping the unused beer in mass quantities straight into municipal wastewater systems isn’t permitted in most places, because of the environmental problems it can cause, so most brewers will likely be sifting through expensive disposal options.

For example, Denver-based MicroStar Logistics LLC — the country’s largest keg company, whose customers include 1,000 brewers — plans to treat the beer with defoamer and balance the pH. Only then can it be sent to municipal water authorities for additional testing and treatment before its release into waterways.

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