▶︎ Craft brewing has taken US market by storm, but is inhibited in Canada due to different provincial liquor control board regulations. Not only regulations, but new tariffs as well as drinking habits are affecting the craft brewing market.
▶︎ In 2017, the number of operational brewing facilities across Canada increased by 17.6% from 695 in 2016 to an all-time high of 817 in 2017. Over half of the 817 brewing facilities are located in either Ontario or Québec.
▶︎ Domestic brewers still account for 84% of the beer purchased in Canada.
▶︎ In 2017, per capita consumption of beer in Canada stood at 75.5 litres, down 2.1% from 2016.
▶︎ In 2017, national can sales rose 4.3%, keg sales were up 1.2%, and bottle sales declined by 10.7%. In total, cans currently hold 60% share of the Canadian beer market, with bottles and kegs holding the remaining 30% and 10% respectively.
▶︎ Wheat prices dropped in recent past, but are predicted to increase steadily through 2018 and beyond.
▶︎ Aluminum prices are steadily increasing. In May 2018, The U.S. gifted Canada with hefty tariffs on steel (25%) and aluminum (10%) - the consumer is ultimately the one holding the bag! Canada exports to the U.S. around 84% of the 3.2-million tonnes of aluminum it produces annually, which represents two-thirds of America’s total aluminum imports, according to the Aluminum Association of Canada.
▶︎ An estimated 61.5% of industry products are packaged in aluminum cans, representing a robust increase over bottles over the past five years. Bottles are inferior as cans eliminate UV exposure compromise.
▶︎ According to a joint letter released by several organizations that use aluminum packaging (PepsiCo, Coca-Cola, the Beer Institute, etc.), a 10% tariff on aluminum would cost beer and beverage producers $256.3 million, a 20% tariff would cost $512.5 million and a 30% tariff would run $768.8 million.
▶︎ Per capita alcohol consumption is decreasing. Perception of beer drinking as a less healthy lifestyle is increasing its impact.
▶︎ Preferences of U.S. consumers to U.S. beer are causing a decline in exports from Canada to the U.S.
▶︎ Increased imports from various other countries are also impacting the local Canadian Craft consumption.
▶︎ There has been little technological change in brewing process over the years (essentially centuries - see this link for a brief history of beer and brewing).
▶︎ Wine, spirits and non-alcoholic beverages are increasing popularity causing a decrease in beer consumption.
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