Beer No Longer Recession-Proof

Over at my favorite political blog FiveThirtyEight.com, Nate Silver (of PECOTA and election predicting fame) brings us the startling news that even beer is being affected by the recession. The long held belief beer is a recession-proof good seems to faulter during the last quarter of 2008, and by a significant amount. There are a few theories, one of which Nate says is the rise of the micro and craft brews, which could be true since they are more costly, higher in alcohol content, and thus a person would buy less beer comparatively to say Bud, Miller, or Coors. He also gives a few more explanations, but I don't want to just repeat what he's saying, give it a read.

Beer Tax Hike in Oregon

I was surfing the web on this lovely President's Day and came across the following article:

http://www.kgw.com/news-local/stories/kgw_021309_news_oregon_beer_tax.126942e1.html?npc

Just wanted to start up a discussion and get your feedback on what you think.

My opinion is that I hate taxes, especially when they start to interfere with the craft beer industry. Oregon may rank only 49th in the malt beverage taxation rate, but that is what makes it such a sweet state to brew some ales. Such wondrous names as Rogue and Hair of the Dog come from Oregon, and I am sure plenty of fabulous others are their that I have never heard of over here in the East Coast. The economy may be in a bad state, but cut some of the state governments spending instead. I would find it hard to believe that drinking craft beer costs the state money in health care, law enforcement and substance abuse problems. Hey government, pick on somebody your own size and stay away from the brewers!

InBev looking to buy Anheuser-Busch?

If you follow the news or financial markets at all., you might have noticed this rumor pop up in the past day or two. InBev, maker of Stella Artois, Beck's, and Brahma, is possibly looking into buying Anheuser-Busch, the American brewery with the majority of the market share in the U.S. This is not the first foreign takeover of mainstream American breweries, as Canadian company Molson bought out Coors Brewing and Miller Brewing was bought by SAB (South African Breweries, now headquartered in London).

Ok, now that we are done with the geography lesson, let's look at how this could effect the beer market here in the U.S. With the top three companies in terms of market share in America (A-B, Miller, Coors in order) being owned by foreign entities, this leaves Boston Beer Co. (Sam Adams) as the largest American-owned brewery. What does this mean? Well, in terms of quality and recipes of beer, probably not much. As mentioned before, Miller and Coors have been foreign owned for quite some time without little notice from the average beer drinker, mainly because there was probably little change to their formulas. If A-B is bought by InBev, there will be no impact on Bud, Bud Light, etc. However, as craft beers continue to rise in popularity and Americans begin to expand their beer palates, foreign companies might begin to see the profitability of bringing their brews here.

So, we might not see any impact or change on the popular brews we are used to, but could possibly see an increased variety of imports, making it exciting times in the beer community. Between the craft beer and microbrewery explosion, and the addition of these imports, America is in for a treat. Below are the USA TODAY and MarketWatch.com articles with a better explanation than I can give, but MarketWatch is slightly weary on whether the transaction could actually happen. I say bring it on! What do you think? I also added an article from the Toronto Star I read a while back about America's rise in craft beer.

USA TODAY
MarketWatch
Toronto Star

UPDATE: Looks like InBev has a Plan B with SABMiller.