There was a time, Christchurch brewer Ralph Bungard recalls, when New Zealand beers were like airport terminals – virtually impossible to tell apart. Mass-produced in what’s known technically as a brown lager style, they were all fizzy, sweet and flavourless. “You’d be struggling,” Bungard says, “to pick the difference.”
Then something happened. In 1980, a publican and former All Black named Terry McCashin, sensing a tide of resentment at the lack of choice available to the beer drinker, did the unthinkable.
He bought the Rochdale cider factory in the Nelson suburb of Stoke, hired an English brewer and launched a range of beers called Mac’s. They were batch-brewed in the traditional manner and complied with 16th-century German beer purity laws that stipulate only four ingredients: water, yeast, hops and malt.
It was an audacious challenge to Lion and DB, the heavyweights that had carved up the brewing industry between them for as long as anyone could remember.
Famously intolerant of competition, the duopoly did its best to drive the interloper out of business (click here). But McCashin’s timing was propitious: in Britain, the influential Campaign for Real Ale (Camra) was leading a backlash against multinational brewing giants.
Traditional ales were making a comeback as beer aficionados rebelled against the homogenisation of British beer and the corporate takeover of the English pub.
Slowly but inexorably, Mac’s caught on. Its popularity was boosted by New Zealanders returning from their OE who had been exposed to a range of beer styles and were eager for something more satisfying than the narrow range of draughts and lagers on offer from the big two.
Emboldened, others soon followed McCashin’s lead. In 1986, Auckland’s Shakespeare Hotel became New Zealand’sfirst pub in the modern era to brew its own beer. Independent microbreweries began springing up around the country: Anchor in Porirua, Strongcroft in Petone, Sunshine in Gisborne, White Cliffs (now known as Mike’s Organic Brewery) at Urenui, in northern Taranaki. Not all survived, but the genie was out of the bottle.
The ultimate confirmation of McCashin’s success came in 1999, when Lion made him an offer he couldn’t refuse. But rather than take him over to shut him down, as might have happened in an earlier era, Lion not only kept Mac’s going but poured money into the brand and expanded the Mac’s range, ultimately winning grudging praise from beer purists long used to regarding Lion as the evil empire.
DB, meanwhile, had reinvented its Greymouth-based Monteith’s brand as a “traditional” range. It was recognition by the dominant industry players that the beer market had irrevocably changed; the growing appetite for “craft” beers could no longer be ignored.
FOAMING AT THE MOUTH
Today, McCashin marvels at what he started. Craft beer – made in the traditional manner, usually in small quantities and in styles eschewed by the big breweries – is the growth segment of an otherwise shrinking beer market.
A website called Beer Tourist lists 130 independent breweries, brew pubs and specialist beer bars scattered from Whangarei to Invercargill, and 12 annual beer festivals.
Craft brewers consider themselves the pirates and rebels of the brewing scene, an ethos reflected in the quirky names they bestow on their beers – names such as Bitter and Twisted, Wobbly Boot, Pernicious Weed and Dead Canary.
They offer a range of styles and flavours undreamed of by previous generations of drinkers: wheat beer, pilsner, porter, lager, pale ale, bitter, stout, brown ale, seasonal ale (made for a particular time of year) and even fruit-flavoured beer.
New Zealand has its own equivalent of Camra, too, cleverly named the Society of Beer Advocates (Soba). Membership isn’t huge – about 700 – but what they lack in numbers, beer enthusiasts make up for with fervour. Craft brewing is to beer as punk was to pop music in the 1970s – a revolt against blandness and corporatisation.
Mass-produced brands such as Lion Red, DB Draught, Tui and Speight’s – the airport terminals of the beer world, to use Bungard’s metaphor – remain ubiquitous, but their share of the market is in decline.
Overall, beer consumption dropped by 6.6% last year, continuing a steady fall stretching back to the 1970s. Beer’s share of the total alcoholic beverage market dropped from 81% in 1996 to 61% in 2012, partly because of a shift in consumer preference to wine.
But the overall decline disguises a significant trend. Production of beer with an alcoholic strength of more than 5%– the category that includes craft beer – increased by a remarkable 62% last year alone. In contrast, the market segment that includes lower-alcohol, mass-consumption brands such as Lion Red and DB Draught shrank by nearly 9%.
Craft beer’s overall share of the market remains modest – less than 10%, says Jenny Cameron, external relations director of the Brewers Association, which represents the big industry players. Take out the “popular” craft beers made by the big breweries, such as Mac’s and Monteith’s, and she estimates that the small, independent breweries’ share of the market is probably 4-5%. Other industry sources suggest it’s smaller still: between 3 and 4%.
But it’s growing. Statistics suggest that New Zealand beer drinkers are consuming less and opting for quality over quantity, even if it means paying more. As Bungard says, “We’re past the days when people would glug down a crate of beer with their friends on a Friday night. That’s part of craft brewing’s success: it’s about drinking less but drinking something with more flavour.
“If you’re going to have a drink in a social situation, then instead of having three pints you can quite happily sit on one, enjoy the flavour and drink it a lot slower. The big breweries understand that; they have a pretty good handle on trends in the marketplace and they know very well that if they want to grow their volumes, then they have to move into those styles of beer.”
THE BEER NECESSITIES
Bungard is president of the Brewers Guild, which represents more than 60 breweries, and owns Christchurch’s Three Boys brewery, which he launched in 2005.
He experienced a typical conversion to craft beer, having returned to New Zealand after several years in Britain, where he worked in biochemistry, only to be dismayed by the “abysmal” range of beers available here.
New Zealand craft beer initially struggled to get a foothold in a market where many bars were locked into supply agreements with the big breweries, but Bungard says its resurgence is part of a global trend.
Nowhere is the boom more marked than in the United States. Long regarded as a beer enthusiasts’ wasteland, the US now has more than 2000 craft breweries and is seen by many as the spiritual home of craft brewing.
The trail-blazers in the US, California’s Sierra Nevada brewery and Boston’s Samuel Adams, have far outgrown their artisan origins yet retain their credibility among beer aficionados – proving, Bungard says, “that it can be done”.
Bungard observes that there’s a “back to the future” trend in New Zealand, whereby independent breweries are again becoming established in the provinces, just as they were decades ago before regional brands were swallowed up by the dominant players.
Nelson, with 13 small breweries, promotes itself as New Zealand’s craft brewing centre, though Bungard thinks Christchurch (where the Beer Tourist website lists at least 16 breweries) has a stronger claim. In both places, proximity to raw materials – hops in Nelson, grain and malt in Canterbury – has helped stimulate interest in brewing.
As for the craft beer drinking centre of New Zealand, the general consensus seems to be that it’s Wellington. Bungard thinks that has something to do with the capital’s celebrated cafe culture and an abundance of well-paid public servants.
Auckland, by contrast, is regarded as a tough market for craft brewers. He describes it as a “label-out” market – one where fashion-conscious drinkers hold their bottles with the labels facing outwards so that others can see what they’re drinking.
I DRINK, THEREFORE I AM
But what, exactly, is “craft” brewing? Here problems arise, since there seems to be no agreed definition. Part of the reason is that the term “craft” doesn’t just refer to the type of beer brewed or the methods used. It embodies a holistic approach to beer that can be emphatic in its insistence on philosophical purity.
The definition offered by McCashin, the man who started it all, seems as complete as any: “Brewery owner-orientated, sticking to the German beer law of having only malt, water, hops and yeast, and the end product being determined by the brewer rather than being under corporate control.” He then adds: “And certainly not foreign-owned” (as Lion and DB are).
“Some people would say that a craft brewery is one where the people who own the business actually make the product,” Bungard says. By definition, that rules out the corporate breweries, whose craft brands are dismissed by some of the purists as “pseudo craft”.
Dominic Kelly, who owns trendy Wellington beer bar Hashigo Zake (Japanese for “pub crawl”), argues that the words “corporate” and “craft” are mutually exclusive. As he sees it, the very essence of craft brewing is that it sprang up in defiance of big corporate breweries.
“The craft brewing movement arose relatively spontaneously all around the world as a reaction to the consolidation of the brewing industry that went on throughout the 20th century,” says Kelly, a former software developer who opened his bar after returning from several years spent overseas.
Corporate breweries may claim to make craft beers, Kelly says, but “you can’t be part of the empire and part of the rebellion”.
For that reason, Kelly was deeply disappointed when Dunedin craft brewery Emerson’s, established in 1993 and revered by beer purists, was taken over late last year by Lion for a reported $8 million. Although founder Richard Emerson has stayed on and Emerson’s has pledged to retain the brand’s “distinctive character and authenticity,” Kelly announced in the Soba newsletter Pursuit of Hoppiness that he would be withdrawing the brewery’s beer from sale in his bar. Lion, he said, had spent decades closing down competition and using its dominance to control outlets – practices that had stifled the emergence of craft beer.
Kelly says he suspects Lion and DB are under increasing pressure to loosen the conditions of the exclusive supply agreements they sign with outlets to shut out competitors. “I believe the Emerson’s range is the bone Lion will throw to its contracted outlets to satisfy their desire to stock better products.”
Lion spokeswoman Liz Read counters that Kelly’s objections have nothing to do with beer. She thinks he just has an issue with big business.
Read enthuses about craft beer, saying it’s good for the beer industry overall because it promotes the idea that beer is varied and exciting. She says Lion has been “incredibly supportive” of the changes in the New Zealand beer market and cites the company’s backing for the annual Beervana festival, which showcases craft beers.
But as she points out, what’s often forgotten is that the majority of consumers still prefer beers such as Lion Red and Speight’s. And it’s hard to argue. No one ever saw a crowd of males at a provincial rugby match clutching bottles of Renaissance Stonecutter or Epic Hop Zombie.
“The microbrewers start by making beers they like, then go out and convince other people to like them too,” says Read. “We start by making beers the consumers like. There’s a place for both.”
NO BAR TO SUCCESS
The issue of “tied houses”, where bars and pubs are tied to restrictive contractual arrangements with beer suppliers, is one that never seems to go away.
It was central to the emergence of the real ale movement in Britain, where beer lovers objected to the limited choice available in corporate-controlled pubs, and it’s a source of continual irritation to beer enthusiasts here – though much less of a problem than in the 1970s, when Lion and DB between them owned or controlled nearly 500 pubs.
The two major breweries are still widely regarded as the ogres of the industry, using their commercial heft to keep other brands at bay, but Read insists there are “very, very few” tied outlets – and where they exist, it’s purely a commercial decision on the part of the bar owner.
The tied house system – alternatively known as “buying taps” or “buying pourage” – takes varying forms. Bruce Robertson, chief executive of Hospitality New Zealand, which represents hotel, bar and restaurant owners, says it can mean the bar owner agreeing to stock beer from only one brewery in return for “a truckload of money” to help buy or refurbish premises.
“With both DB and Lion taking that approach to protect their market share, it does make it challenging for the independents,” Robertson says.
But he adds that at the more sophisticated end of the market, the surge in demand for craft beer is being reflected in increased independence among bar owners. “We are seeing a greater trend towards hospitality operators deciding they don’t want to be tied to either brewery, so that they have both the main brewers’ products and a range of craft beers as well.”
Like wine, beer has developed its own esoteric vocabulary, which can be incomprehensible to outsiders.
Does his organisation disapprove of breweries buying taps? “Our members make their own commercial decisions,” Robertson says. “But as an industry, the more competition the better.”
Bungard takes a pragmatic approach. “Usually there’s an arrangement where a bar will go to a brewery and say, ‘We’d like to serve your beer but we’ve got nothing to serve it through – could you put some lines and taps in?’ It’s big money – you’re talking ten or fifteen thousand dollars to put lines and taps and chillers in. You’d be pretty miffed if you did all that for a bar and then it went and served someone else’s beer.”
He points out, too, that lack of choice can’t always be blamed on restrictive contractual arrangements. It may be simply a case of a bar owner who hasn’t woken up to the demand for craft beers.
As for future trends, it seems generally accepted that craft beer is on a growth path. “There’s definitely a move from quantity to quality,” says the Brewers Association’s Cameron, who points out that there’s also increased demand for premium international brands such as Heineken and Stella Artois.
At seminars Cameron attended at the recent MarchFest, a Nelson beer festival, speakers predicted that the big breweries would get more heavily involved in craft brands, mergers would take place among medium-sized players – as was announced recently between New Plymouth’s Liberty and Kumeu’s Hallertau breweries – and more home brewers would go commercial.
Other trends have been noted too. Bungard acknowledges that an element of pretentiousness is creeping into the craft beer scene – “beard-stroking, I call it”. Like wine, beer has developed its own esoteric vocabulary, one that can be incomprehensible to outsiders.
But ultimately, Bungard says, beer remains the people’s drink. “Sometimes a beer is just a beer, something you hold in your hand while you’re socialising, and you don’t want to get into earnest analysis.” And he admits that after mowing the lawns on a hot day, even he prefers a fizzy cold lager to a 10% double stout.
THE ART BEHIND THE CRAFT
A winemaker turned brewer reflects on the differences between the two.
For Belinda Gould, beer is the new wine – almost literally. Formerly a highly regarded winemaker for the Canterbury label Muddy Water, Gould now makes beer for the Brew Moon Brewery and Cafe, which she owns with her partner, Kieran McCauley, in the small town of Amberley, north of Christchurch.
Gould developed a taste for craft beer while working in California in the late 1990s. She says brewing beer is “similar but different” to wine- making, and definitely more fun.
As a winemaker she got only one chance a year to get it right, whereas brewing is constant – two brews a week of 600 litres each. And she’s not at the mercy of nature. “You don’t spend all that time worrying about what the vintage is going to bring, and then, when it arrives, how you’re going to handle it. And then getting ready for the next one.
“You do it regularly, so you get quite good at it. There’s a lot of satisfaction in being able to achieve consistency. And because I have way more control than in winemaking, it’s more relaxed.”
Gould says she’ll never make a fortune, but that doesn’t matter. She’s not inter- ested in expanding, because the present scale of the operation is quite manageable. “It’s quite a physical job, brewing; you’ve got to lug sacks of malt and mash around.
If [the brewery] was much bigger I think I’d find it too hard.”
Brew Moon produces four beers: Amberley Pale Ale, Broomfield Brown Ale, Dark Side Stout and Hophead India Pale Ale. About two-thirds of the production is sold through Beer NZ, a craft beer distributor whose website lists more than 30 brands. The remainder is sold through the cafe.
Asked to define craft beer, Gould says it should be an artisan product, made by the people who own the brewery. “I don’t think craft breweries can be owned by multinationals, any more than boutique wineries can be. It’s got to have a soul.”
And while beer may traditionally be associated with men, she notes that more women are drinking it. “The really fun thing is that we get a lot of interested young women in here who know what they’re talking about with beer – young professional women who Belinda Gould and Brew Moon Brewery and Cafe: with beer there is more control.really dig good beer and look for some- thing a bit different. They very rarely ask for a lager, which is just as well, because we don’t make one.”
Jenny Cameron of the Brewers Association, which represents the big brewery companies, has noted the same trend.
A craft beer enthusiast herself, she says supermarkets have expanded the market by stocking craft beer. “My association wants to encourage women not to be afraid of beer and to realise that there is a range of styles and flavours just as there is in wine.”