Bottoms Up

Beer and wine in the Bay Area and beyond

Germany’s Beer Troubles

By William Brand
Wednesday, April 6th, 2005 at 12:09 am in Uncategorized.

What is it about good beer? It’s fate always seems to be hanging by a thread: Good breweries go belly up; lousy breweries making lousy beer go on and on.

I used to think, well, there’s always Germany. Germans love their beer. Sadly, times are changing. I got a hint a couple of years ago when I saw a bunch of young German tourists running out of a Beverages N’ More store in Oakland, cases of American Budweiser on their shoulders. Oh my.

Then, on a trip to Germany last year, I sat in on a press event at a large regional brewer’s headquarters. Know what the buzz was? Beer with cola? Can’t blame the brewer. They make a very fine pils, which is imported into the United States.

But in Germany, they went to Cola and Lemon and Energy (caffeine) added beer to sell to the 20-something market. “Young people today just don’t want to drink what their grandfathers’ drank,” one VP said.

Don’t believe it? Check out this story in Tuesday’s Independent, the big London daily: Here are a couple of quotes:

“For those of us brave enough to have taken German as a foreign language option at school, the linguistic difficulties caused by words like Verantwortungszuständigkeiten were usually compensated by the prospect of a language exchange to Germany, because in Germany were beer halls and in beer halls was German beer. Frothing over the glass, hauled over to the table by fragrant maidens, huge in volume and cheapish in price, it was beer with exotic ethnic spectacle thrown in.

“But not for much longer, if recent rumblings about the worsening relationship of Germans with their beer are true. There’s even a word for it – Brauereinsterben, or the death of brewing. Last month, two sizeable breweries closed down in Berlin and Dortmund, with 450 jobs lost. According to the Federal Office of Statistics, Germans are drinking only 113.9 litres of beer a year, whereas they drank 132.7 in 1994. German beer consumption is declining by between one and two per cent a year, according to a 2003 report by Credit Suisse First Boston. It may still be the third-largest beer market in the world (after the US and China), but trouble, nonetheless, is definitely afoot.

“German breweries are an increasingly vulnerable target. International mega-firms like Interbrew have started buying German breweries, somewhat of a shock for a country that – compared to the lands of Carlsberg or Stella – hasn’t bothered exporting many of its products, and whose beer purity law has been a source of national pride for eight centuries. But in 2001 Interbrew bought Beck’s, and the year after that Heineken bought Karlsberg, and things changed for good.

“Birte Kieppe, a spokesperson for the German Brewers Association, refers pointedly to “the so-called ‘death of breweries’” and says the number of breweries in Germany has stayed almost constant: 1,275 this year and 1,274 in 2003. “But I’d be very careful with that number,” says one industry analyst. “If you break it down, 800 of those breweries are selling 5,000 hectolitres or less per annum. Some of them are no more than hobbies, and they don’t contribute much to the industry profit-pool.”

“Micro-breweries are pumping up the numbers, and the bigger ones – Radeberger, Warsteiner, Beck’s – are faced with falling consumption of a product that is less trendy than the latest alcopop, and the unavoidable demographic truth that Germany’s beer-drinking population is ageing fast and drinking less, and its young people, like Britons, are turning to alcopops and wine.

“In the UK, 82 per cent of people say they don’t think beer goes with food and 81 per cent think beer can’t be part of a healthy diet. Germans are coming to the same conclusion. Beer bellies are no longer popular, no matter how often brewers point to the purity of their products, or the provisions of the Reinheitsgebot purity law from 1516, which – until this February, when a small brewer won the right to add syrup – obliged Germans to brew beer that contained only grain, water, hops and yeast.

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