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Micro-, pubbrewers meet in Milwaukee.

The 1992 National Microbrewers and Pubbrewers Conference and Trade Show in Milwaukee proved the largest ever, with 371 brewers and aspiring brewers in attendance. The trade show also set a record for the conference, with 44 booths on the trade floor, representing industry suppliers of everything from fermenting vessels to glassware.

The keynote address for the conference was delivered by Paul Shipman, president of the Redhook Ale Brewery. Representatives of the large commercial breweries were also on the docket, as Ray Klimovitz of the Stroh Brewery Co. led off the first technical session with a discourse on malt. Later in the conference, John Kaestner, of the Anheuser-Busch consumer awareness department, provided guidance on the brewer's role in public awareness; and George Wornson, of the Miller Brewing Co., gave a talk on landfill minimization.

Luminaries from the microbrewing community were also on hand. Fred Scheer of the Frankenmuth Brewery provided some insight into the sources of diacetyl flavor in beer; Jeff Ware of Dock Street Brewing Co. measured the pros and cons of microbrewing versus contract brewing; and Pete's Brewing's Mark Bozzini delved into marketing.

Dave Edgar provided a perspective on the microbrewing segment from his position as assistant director of the Institute for Brewing Studies. Edgar reported 10 microbrewery and 47 brewpub openings in 1991, balancing this against 6 microbrewery and 13 brewpub closing over the same period. Edgar reported a total of 242 micros and brewpubs in operation in 1991, and estimated their taxable production at 345,036 31-gallon barrels.

Edgar also offered some figures compiled by the Institute on the sales distribution of beer by microbreweries and contract brewers. According to a survey done by the Institute, 46 percent of the responding microbreweries self-distribute their products, while 54 percent use a distributor. The average number of distributors for a distributing microbrewery is ten. The responding micros reported in-state sales made up 88 percent of their business (68 percent of it local) and out-of-state 12 percent. According to the survey, contract brewers were more likely to use a distributor (86 percent of those responding) and were more likely to sell out of state (66 percent of those responding).

Edgar reported that many people have asked where the next booming market will emerge for the microbrewing segment. In answer, he said, "I look into the crystal ball and all I see is Hefe-Weizen." (A reference to the primary product of a successful Portland, OR-based micro, the Widmer Brewing Co.). On a more serious note, Edgar said, "For microbrewing the future is bright. Although many industries were hurting in 1991, micros continued to grow and sell more beer."

Gary Nateman, vice president and general counsel for the Beer Institute, also spoke, and provided a cogent summation of some of the potential problems facing small-scale brewers because of Canada's recent GATT complaint. He highlighted two major points, the questions raised about the excise tax break for small brewers and the ability to sell direct.

As one alternative to boosting the excise tax on small brewers, Nateman pointed to the possibility of having all producers, large and small (and including importers) pay $7.00 on the first 60,000 barrels produced, and $18.00 after that. Another option, he said, would have small brewers pay the full exercise tax, with some provision for refunds.

On the subject of selling direct, Nateman said, "GATT didn't threaten the three-tier system specifically. All they said was that if you have a law for a brewer to go direct, it must be available to everyone."
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Title Annotation:1992 National Microbrewers and Pubbrewers Conference and Trade Show
Publication:Modern Brewery Age
Date:May 18, 1992
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