Brooklyn Brewery goes Asia

After Stockholm and Trondheim, Brooklyn Brewery will tap into South Korea’s booming craft beer market by building a brewery in Jeju, a tropical island off the country’s southern coast, which serves as a popular tourist destination.

Steve Hindy, the co-founder of Brooklyn Brewery, said in a press conference in Itaewon, central Seoul, on 24 May 2016 that craft beer has been gaining popularity among local drinkers since 2010 but the market is still very small, compared with other regions like the U.S., western Europe, and Japan.

According to a report by the Australian government (February 2016), beer imports increased over 300 percent between 2009 and 2014 with Korean consumers shifting their preference from local beers to premium brands, ales and wheat beers. One reason for this change was the implementation of free trade agreements between European countries and the United States.

Korea’s beer imports totalled USD 142 million in 2015, up 27 percent from 2014. Imports by volume reached 1.7 million hl, up 43 percent. Korea’s domestic beer production was nearly 21 million hl in 2014, according to the Barth Report.

The jump in imports has seen the two main local brewers – AB-InBev’s Oriental Brewery and Hite Jinro – lose market share: from commanding 99 percent of the market in 2012 to sliding to 82 percent in the first half of last year, media say.

Brooklyn’s Korean brewery has been in the pipeline for several years. It was first slated to open in 2014, according to Korean media. It seems that the original plans had to be shelved for various reasons, hence the delay.

By setting up a brewery in Jeju together with local entrepreneur Hyukkee Moon and his partners, Brooklyn Brewery plans to localize production and distribution and also develop new brands. The production facility will have a capacity of 40,000 hl beer annually. Equipment will be installed this year. Some of the beer produced in the Jeju facility is expected to be exported to other countries in Asia.

The Korean plant is Brooklyn’s third overseas brewery after the ones in Sweden and Norway, which were set up in partnership with Danish brewer Carlsberg.