The craft beer industry is facing some frothy challenges, as brewers across the United States report more closures than openings for the first time. Making matters worse, beer sales have taken a hit, and operational costs are on the rise. According to the Brewers Association, the nation saw 399 brewery closures compared to 335 new startups in 2024, signaling some sobering times for the industry.
The economic stumbling blocks for craft breweries first brewed up during the onset of the COVID-19 pandemic, and they've lingered as market conditions have evolved. Paying more for grain, raw materials, and shipping is a shared headache among brewers, with beer sales dipping by 2% nationally. Colorado, long a bastion for craft beer, has had its sales slump by 3%, as reported by the Colorado Liquor Enforcement Division. Bart Watson, president and CEO of the Brewers Association, told FOX Business, "The pandemic obviously also had secondary ripples for the economy, for supply chains, and it changed consumer patterns overall."
What's happening in the broader U.S. landscape is reflected in the microcosm of Arizona's own beer scene. While nationwide production declined roughly 2%, Arizona's craft brewers are trying to adapt to drinkers' shifting affinities. Tyler Smith, owner of Kitsune Brewing Co., told the Phoenix New Times, "We can see the writing on the wall." To remain competitive and appealing to a broader clientele, Kitsune has broadened its menu to include wine, sake, canned seltzers, and larger selections of nonalcoholic options.
Bauman, the executive director of the Arizona Craft Brewers Guild, remains cautiously optimistic. "I always say I have 100 different breweries in Arizona and they have 100 different business models," Bauman says, highlighting the versatility of Arizona's beer producers. However, bracing for changes and uncertainty carries a real financial weight, especially with 25% tariffs on imported aluminum and steel, which impact can costs and brewmasters' bottom lines, as reported by the Phoenix New Times.
Local brewers, nevertheless, are finding creative solutions. Pool, Wren House's co-owner, has kept his American lager, Valley Beer, at $6 a pint regardless of economic fluctuations. "That’s our inflation buster and we plan on charging $6 for it 10 years from now," he stated, as per a report by the Phoenix New Times. Watson had said that closure rates appeared the highest in "states with the highest number of breweries," such as California and Pennsylvania, along with heavy impacts on the West Coast and Pacific Northwest, as mentioned by FOX Business.
Despite the tumult, the craft beer scene isn't crying into its pilsner just yet. Brewers are digging in, hosting events, and creating experiences to connect with the community. From record shows to collaborations and festivals, these brewers are pouring effort into not just crafting quality beers, but also crafting lasting relationships with their patrons.
