US. What qualifies as craft beer?

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Small brewers say it’s crafty of their bigger brethren to market some labels as “craft” beer.
There was a time when it was clear who made a beer. The name on the label matched the company of its origin.

However, with the recent rise in craft breweries, the associations have become blurred.

To diversify, large macrobrewing companies, such as Anheuser-Bush InBev, have created offshoot brands resembling craft beers, such as A-B’s Shock Top, and are buying out craft beer companies, such as A-B’s purchase of Chicago-based Goose Island.

Now, craft brewers are speaking out about this practice. The Brewers Association, whose mission is to promote and protect small, independent American brewers, issued a statement titled “Craft vs. Crafty” to try to set the record straight on what the definition of “craft” is.

Behind the label

An American craft brewer, defined by the Brewers Association, has an annual production of 6 million barrels of beer or less, and no more than 25% of the craft brewery is owned or controlled by an alcoholic beverage industry member that is not a craft brewer. That definition has drawn a hard “us vs. them” line, as both craft and macrobrewers trade barbs.

Craft beer, under those terms, has seen a steady increase in sales in recent years.

In 2011, craft brewers noted a 13% increase by volume, according to the Brewers Association, and in the first half of 2012, volume grew by an additional 12%. At the same time, the overall beer industry was down 1.3% by volume; domestic non-craft was down 5 million barrels in 2011, according to the Brewers Association.

During that time, more craft breweries have been bought out by macrobrewers. If a large brewer has a controlling share of a smaller producing brewery, the brewer is, by definition, not craft, according to the association. The group deems products produced by such breweries as “crafty” beers because they’re not labeled as products of large breweries.

Because beers such as Blue Moon Belgian Wheat or Shock Top are not clearly labeled as made by SABMiller or A-B, respectively, the Brewers Association says many drinkers are fooled into thinking they’re drinking a craft product.

“The large, multinational brewers appear to be deliberately attempting to blur the lines between their crafty, craft-like beers and true craft beers from today’s small and independent brewers,” according to a Brewers Association release. “We call for transparency in brand ownership and for information to be clearly presented in a way that allows beer drinkers to make an informed choice about who brewed the beer they are drinking.”

Julia Herz, Brewers Association craft beer program director, said the statement came in reaction to increased media coverage of craft beer.

Herz said the Brewers Association does not define craft beer — it leaves that to the market — but it does define what a craft brewer is, and that definition was created in 2005.

“The point we bring up is to not to blur the lines in the marketplace, to stay true to bring up what is in the bottle,” she said. “No one should tell beer lovers what to drink. They need to educate themselves and go forth, conquer and enjoy.”

Both A-B and Miller are members of the Brewers Association. Both are classified as non-voting members, due to their size.

Brewers’ response

While Anheuser-Busch Fort Collins brewery General Manager Kevin Fahrenkrog didn’t directly address the Brewers Association’s allegation that A-B is blurring beer lines, he said in an e-mail that the facility brews Shock Top and selected Goose Island brands.

“The growth of beer styles has given rise to hundreds of small brewers and earned our Shock Top, Goose Island and other brands a place in this growing segment,” he said. “Each of our beers has its own identity, but each receives our care and craftsmanship to assure its quality maintains the trust of our consumers.”

Around the same time that the Brewers Association released its statement, Steve Hindy, co-founder, president and chairman of The Brooklyn Brewery in Brooklyn, N.Y., wrote an opinion piece on on Dec. 12 stating that the purchase of Mexico’s Modelo beer brands by A-B is the equivalent of forming a beer “duopoly.”

“Ultimately, with limited choices, the beer consumer loses,” wrote Hindy, who noted that if the Modelo deal goes through, Miller and A-B would control more than 80% of the U.S. beer market.

The fear among small brewers is they will be edged out for shelf and tap space by the big brewers. Craft brewers struggle to get the attention of distributors, Hindy noted.

Shortly afterward, MillerCoors CEO Tom Long fired back with his own opinion piece, in which he claimed, definitions aside, to brew some of the most popular craft beers in the marketplace. Long asked readers not to confuse the style of a beer with the quality of the beer, defending brands such as Blue Moon and noting that it introduces many to the craft beer scene.

Launched in 1995, Blue Moon went on to become the best-selling craft beer in the country, Long wrote.

“We know that no matter what style of beer it is, we will ultimately be judged by the quality of our beers. We like that, because we are confident that the quality of our beers stacks up well versus that of any brewer of any size, anywhere,” Long wrote in his CNN column.

New Belgium Brewing is the third-largest craft brewery in the country, and spokesman Bryan Simpson said the company aligns with the Brewers Association in calling for transparency. Simpson said one of the greatest assets of a craft brewer is its story and ability to connect with a community in which its beers are made. The call to clearly label who makes beers is a call to level the playing field, he said. “I think there will always be a fight for shelf space, share of mind and stomach,” he said. “As long as everyone is in agreement in terms of what tools are used, the consumer benefits.”

But does the public care? James Francis, director of the Beverage Business Institute, which has ties to both big breweries and craft breweries, is not convinced.

“I think a small percentage, who would be craft beer snobs, would really care about it,” Francis said. “Otherwise, I think they are more concerned about what is in the bottle and whether or not they like it.”

Francis said today’s generation of beer drinkers tends to favor several beers, as opposed to the former, which had one or two go-to beers.