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Oakes Weekly - October 30th

Contract Brewing and Why I'm Not a Fan
Oakes Weekly October 29, 2003      
Written by Oakes

Vancouver, CANADA -

One of the stickiest issues here at Ratebeer is with regards to contract brewing. There are as many different permutations of contract brewing as there are styles of beer, so it can be hard to keep track. I will go over many of these and hopefully clear a few things up.

<P>At its basest, contract brewing is when somebody else brews a beer, and you market it. Yet even that broad definition does not neatly cover all of the available options. But more on that later. First and foremost, there is the straight up "beer marketer" arrangement. In this instance, the beer is created and marketed by a company who contracts out the brewing to someone else. The He'Brew beers are an example of this. They're currently brewed by Mendocino at Saratoga Springs, NY, but are marketed by an outfit called Shmaltz Brewing. Most of these firms have misnomers like that - none of them actually brews anything, but they do sell beer. Pete's Wicked and Sam Adams had their start under this type of arrangement. Typically, the marketing company provides the recipe for the beer, though sometimes with the input of the actual brewer.

<P>A variant of this is a house-brand or store-brand arrangement. Often you'll go into a restaurant and they will have their own brand of beer. Of course, they don't brew the beer themselves. Worse yet, half the staff won't have any idea who does. In reality, a lot of microbrewers get into restaurants by taking one of their existing brands - an amber ale or bland lager normally - and re-brand it for the restaurant. So the tap handle at Joe's Bistro might read Joe's Amber Ale, when really it is the same amber that is on tap at bars all over town under the micro's regular brand name. Occasionally, these are "altered" recipes, which typically means a little dry-hopping. You won't find too many brewers willing to dedicate an entire batch of brew (in order to accomdate a unique recipe) to a restaurant or bar, unless that restaurant or bar happens to have a serious throughput. Two notable examples of this are pico-batch contract brewers La Barberie in Quebec City and Custom Brewcrafters in Rochester.

<P>As bad as it is to try and sort out the origins of house-brand beers (because sometimes you've not ever had the beer under its normal brand), store brands are often worse. While your waitress or bartender might be utterly clueless as to the origins of the house brand beer (and they usually are), somebody will know the answer because all the management tends to be under the same roof. In Europe especially, there are store brands - beers labelled for major grocery store chains. Dream on if you think the pimply-faced stockboy can tell you where those cans of store-brand lager really come from. The worst is probably the UK stores - Tesco in particular. They don't even sell normal-brand beers. Everything they sell is Tesco German Pilsner, Tesco Sweet Stout or whatever. They're all some other well-known beer being sold under the Tesco label, but as for what's what it can be difficult to determine.

<P>One of the annoying things about Europe is their labelling laws (and ours here in Canada, too) make it too easy to hide the true origins of contract-brewed beer. In the United States, they make life easy. The brewing company can list its own name, but the location is not the location of the company's offices, but rather the location of the brewery itself. So anything brewed in New Ulm, MN you automatically know is made by August Schell, regardless of what the name of the "brewing company" listed is. In Europe and Canada, no such laws exist. So European supermarket-brand lagers could emanate from just about anywhere in theory (although typically only a handful of breweries actually produce these - usually larger independent swill factories like Bavaria in the Netherlands). Finding out the truth can be difficult. In Alberta, there is something called Mountain Crest Lager. The marketers of this beer have gone to great lengths to protect the identity of the brewer who makes their stuff. It is only thanks to the fact that if nobody else gets to know the truth, the taxman does, that we know their beer comes from Joseph Huber in Wisconsin.

<P>Another type of contract arrangement is contracting out only certain means of production. For example, Three Floyds used to have their bottles done in New Ulm. The draught was from Indiana, but they didn't have the ability to service all the markets they wanted to in bottles from there facility, so they contracted out bottled beer production. In other cases, production of a given beer will be kept in-house domestically, but contracted out overseas. This often helps with distribution, and you see Labatt's making a good living off of their Guinness and Budweiser contracts. It's not that Anheuser-Busch can't ship to Canada, it's just easier to have the domestic pricing and top-tier distribution that comes from contracting out. Molson even used (maybe still uses for all I know) Moosehead as a contract brewer for Atlantic Canada.

<P>Other more obscure arrangements also exist, as highlighted by a couple in my neck of the woods. Denison's Brewing is a contract brewer of sorts, but with a slightly different arrangement. Principal Michael Hancock doesn't rent the brewing expertise of Mill Street Brewing, but he does rent time and space at their facility. He brews, but doesn't own the equipment. Another unusual deal is for C'est What. This operates basically as a brewpub, but in reality their beer is brewed by County Durham, a small micro in the suburbs. Well, their wort is, at any rate. The wort is then trucked to C'est What, who ferments it on-site. So they are a contract brewer, but not a contract fermenter.

<P>One of the reasons why this is an important issue is that many believe beer is more than just liquid in a glass. Part of the allure of "real" brewing is that breweries and their staff are members of the communities in which their products are served. There is a sense that beer is not a commodity, but is something unique to the community in which it is produced - a function of the surrounding environment, regional history, and a representation of the tastes and values espoused by the adjacent citizenry. Thus, it is less noble at best, outright dishonest at worst, to proclaim oneself to be a brewer when one is not really brewing anything. The labels on He'Brew state that the beer is from San Francisco. This conjures up certain images in the minds of consumers. Perhaps Saratoga Springs does not conjure up these same images - not that it isn't a nice place because it very well could be, but it isn't San Francisco.

<P>The honesty angle runs more deeply than that, though. If it were simply a matter of small outfits like He'Brew, I don't think very many people - not even us anal-retentive curmudgeons here at Ratebeer - would sweat the issue all that much. The real problem lies with large breweries who pretend to be small breweries, other breweries altogether, or who shift production of certain beers from plant to plant without any regard for the local character and history of the brew. Miller created the likes of Plank Road; Molson created Capilano; Sleeman still persists with Upper Canada; Labatt's insists there is such a thing as the Keith's Brewery (no, that raunch doesn't come from that quaint facility with the farmer's market and bricks and such, but rather the giant faceless square box of a plant on Agricola)...the list can go on. And in some cases, it should go on. For example, Pilsner Urquell is a piece of brewing history. I mean that - not only did they (according to those who know) bugger up the beer by removing the wooden fermenters, but they now have shifted some production out of Plzen. You know, the birthplace of pilsner. So the original pilsner is now also produced in Poland and Russia. How is that remaining true to anything? Interbrew wanted to do the same thing with Boddington's, until massive public outcry convinced them to rethink the matter.

<P>So there are times when locale means something. Knowing consumers are aware that different water supplies and brewing equipment can change a beer. That is why they mourned when production of Brakspear beers shifted. And while Brakspear cannot be said to be a contract brew, it does highlight the importance in many cases of knowing where, precisely, your beer is coming from. That Grolsch doesn't want you to know it makes Amsterdam Navigator (Dutch Export Breweries my ass) says something. But as a consumer of beer, I feel that I have a right to who is making what I drink - sometimes it matters and sometimes it doesn't, but that's up to me to decide. Best not to leave it in the hands of breweries, who sometimes wish to convince people of things that simply are not true.

<P>I am sorry if this piece has devolved somewhat into a rant, but this is something that drives the way that Ratebeer views contract beers. We mean it when we list "Brewer". We are sticklers for transparency.
Even though it doesn't always seem necessary, believe me there are times when the truth can be quite eye-opening.



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