Beer and politics III: craft brewers association to vote on “independence”

Although a new constitution for the Craft Beer Industry Association (CBIA) has not yet been finalised, proposed changes in criteria for membership eligibility have already caused the resignation of Lion’s craft beer breweries – Little Creatures, Malt Shovel and White Rabbit.

CBIA has indicated that it “will re-define membership eligibility based on independent (privately held) brewers without relying on an arbitrary definition of craft beer.” Further, it plans to change the board structure and the name of the association to reflect the new direction. Discussions are expected to continue for a few months.

Whether some other members, such as Australian Beer Co, owned by Coca-Cola Amatil and Mountain Goat, owned by Asahi, will be able to retain their membership, is doubtful.

The situation was a major topic of controversy in the beer community in March 2017. In an overview, entitled “Forget craft, what does ‘independent’ mean?” industry commentator Matt Kirkegaard analysed the ramifications of the changes, pointing out that the craft sector has already become a target for venture capital. Thus, there is “an influx of unsentimental dollars interested in rapid growth and target exit strategies for handsome profit. However, such ventures would qualify for CBIA membership. The presence in the market of many various ownership models and funding sources could mean that notions of independence are becoming obsolete when applied to small breweries.”

In terms of volumes sold, Australia’s brewer Lion is the nation’s largest craft brewer and Lion’s Chuck Hahn, who founded the Malt Shovel brewery, was actively involved in the formation of CBIA. Not only did his support play a big part in ensuring that the fledgling organisation flourished, he also persuaded Lion to change its labelling policy to clearly state its ownership of all brands under its control. Contract brewing is a wide-spread industry practice and not all craft brewers were prepared to disclose it.

In his resignation statement, Mr Hahn said that “the current internal focus on big vs. small is divisive and a distraction from more important issues and opportunities facing the brewing industry. There is a part of the industry that seems intent on defining itself not in terms of what’s great about craft – the quality beers, the passionate brewers and the characters behind them – but in terms of who owns what.”

CBIA paid tribute to its co-founder and the exiting Lion brands, but also pointed out that the craft brewing landscape has evolved considerably from the early days of the CBIA just four years ago.

“There are now more than 400 independent brewers in Australia, facing many challenges unique to the small, independent end of the market. The CBIA looks forward to advocating further for the interests of our members as a clear and focused voice for independent brewers and, where our interests align, working alongside the nation’s multi-national brewers”, the association said.