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INSIGHTS Weekly Digest

 Vol 2, No 14   Apr 5, 2021

 News, Numbers, Info, and More                                                       published by Beer Marketer's INSIGHTS, Inc.

All articles shown below are excerpts from one of INSIGHTS’ 5 newsletter publications: Beer Marketer’s INSIGHTS, INSIGHTS Express, Craft Brew News, Alcohol Issues INSIGHTS, and Beverage Business INSIGHTS.
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TAP Expects Big Volume/Earnings Hits in Q1; Guidance Unchanged; Production Shifted to Later in Yr – EXPRESS 3/29/21 Govt filing from Molson Coors revealed double dose of bad news related to 1st qtr effects of cybersecurity incident, TX storm and ongoing on-premise shutdowns in UK. But it also reaffirmed co’s guidance for a better full yr 2021. TAP still expects mid-single digit rev growth in 2021 and approximately flat EBITDA. But that just got more challenging as co will “shift between 1.8-2 million hectolitres” (between 1.5-1.7 mil bbls) from first qtr 2021 to the balance of fiscal year 2021. Last yr, Molson Coors shipped 18.4 mil hectos in Q1. Implies at least a 10% hit to this yr’s first qtr volume, following 8% drop last yr. So this yr’s 1st qtr volume could be almost 20% lower than 2019’s. OUCH. Molson Coors also expects between $120-140 mil of underlying EBITDA to shift out of 1st qtr and into rest of yr.

Can Squeeze? Glass Remains Big Problem, Too, with Easing Not Seen Until Late ’21 at Best – BEVERAGE BUSINESS 3/29/21 Saranac Perma Frost IPA in green bottles, not brown? Reed’s Ginger Brew in brown or even clear bottles, not green? To some shoppers’ befuddlement, those are some of workarounds bevcos have been forced to undertake in recent months as they grapple with severe squeeze on glass bottles that appears to have worsened since last summer, even as most hand wringing has been over aluminum can shortage. A perfect storm of setbacks, many but not all related to ongoing pandemic, has left some producers no longer anticipating alleviation until late this year or even next year.

Boston Beer Invokes Rare Regional Policy of Consolidation in NY; Letters Went to NY Distribs – EXPRESS 3/30/21 Boston Beer took big step last week, invoking somewhat obscure provision in NY state ABC law (55-c) that allows a supplier to consolidate its distribution, if it has a policy of regional consolidation, which can then constitute “good cause” for termination. Boston Beer sent general letter to all NY distribs as part of process, INSIGHTS understands, telling them that it had such a policy. That’s just a first step. Next will be the actual implementation. But this is somewhat reminiscent of all the forced consolidations to Reyes Beer Division in CA, as Boston will likely look to go in many mkts to big distrib (Manhattan Beer) that already does a bunch of its biz.

BA Top 50 Reveals Pandemic Challenges, But Resilience Too; About 12 Mil Bbls, -9-10% CRAFT 3/30/21 Annual release of Brewers Assn's top 50 craft brewing companies by volume largely highlights the Covid-era biz impacts now quite familiar to followers of US craft beer. Draft-heavy brewers hamstrung, while cos with existing “packaging and distribution capacity were best positioned to take advantage of the boom in off-premise sales and weather market uncertainty,” BA economist Bart Watson explained in statement. All told, BA's top 50 craft brewers sold in neighborhood of 12 mil bbls in 2020, we estimate. Doing apples-to-apples comparison suggests BA's 2020 top-50 shipped about 9-10% less than the 2019 top-50 (without New Belgium). That's 1.2-1.3 mil bbls shaved off the top. 

Beer Down 15% for 1-Wk Thru Mar 20; Gaining Share vs Spirits, But RTD Cocktails Gainin’ on Seltzer – EXPRESS 3/31/21 With tuff pantry loading comps in full-effect, total beer sales dropped 15% for 1-wk thru Mar 20 in Nielsen off-premise data. Indeed, “it would be unrealistic for current off-premise sales to outpace or even approach the unprecedented growth from last year” during Mar/Apr, Nielsen’s Danelle Kosmal acknowledged in latest update. While “there will be a lot of negative numbers” in “next few weeks,” sales remain up double-digits vs 2 yrs ago. Interestingly, pantry loading comps have suddenly shifted short-term dynamics for beer within total alc bevs. Beer outpaced both spirits (-21%) and wine (-29%) for 1-wk as total alc bevs dropped 20% in Nielsen off-premise data.

Teavana RTD Teas – And Anheuser-Busch/Starbucks Alliance – Will Sunset in Q3 – BEVERAGE BUSINESS 4/1/21 Back in Jan we likened the treatment of Teavana RTD tea brand by its joint venture partners, Anheuser-Busch InBev and Starbucks, to that accorded a crazy uncle: everyone said he was fine, but nobody really wanted to talk about him. “We remain committed to the tea business,” a SBUX rep told us in Jan. “The status is active via our non-alcohol entity, 9th Street Beverages,” an ABI rep said. OK, so he’s breathing, but is he still able to enjoy his backgammon game? Sadly, it seems poor Uncle Teavana has been moved to hospice. ABI put out word to retailers that RTD line will sunset by Q3, tho Teavana brand will continue to exist as an in-store tea brand at Starbucks and a tea sachet brand on grocers’ dry shelves. 

Out of Control; Spirits Growth Near 10% for 12 Mos in Control States; 3 Key Healthy Signs EXPRESS 4/1/21 Despite short-term outperformance in scan data, make no mistake, longer-term spirits continues to gain share, and roll up big gains. How healthy is spirits biz right now? While distillers fret about looming tariff increase that would whack exports even harder, domestic spirits biz couldn’t be much healthier. First, growth. Spirits volume in control states up 9.1% in Feb after selling-day adjustment, reports NABCA, reminding that 2020 was leap year. Dollar sales in Feb jumped 16%. For 12 mos, control state volume +9.2, $$ +15.4%. Second, premiumization. Price/mix Jan-Feb was +6%-7%. Median price of a 750ml bottle up 4%+; avg price up 6%+. Third, breadth. Every major category of spirits showing growth for 12 mos, from modest vodka gains (+2.6%) to surging RTD “cocktails” (+44%). 

Size Matters: New Mexico to Ban Minis; Florida Might Clear Big, Big Wine Packages – ALCOHOL ISSUES 4/2/21 While most state legislative action over the last year loosened rules regarding alcohol access, some imposed new limits. And, the topic being alcohol, some did both. A sweeping reform bill in New Mexico, for example, broadened alcohol delivery rights beyond restaurants to other retailers and producers, lifted restrictions on Sunday liquor sales, created new, less expensive on-premise licenses and removed distance restrictions (from schools/churches) for those new licensees. Elsewhere, the Florida House overwhelmingly passed a bill that “would repeal a state ban on wine sales in containers larger than a gallon.” And in an early example of retightening some regulations loosened during the pandemic, plus another example of blending alcohol and cannabis policy, the city of Cape May, NJ “introduced an ordinance banning smoking cannabis in public” and shutting down most public consumption of alcohol.

Craft Comes Up Against Crazy Comps: $$ Down 0.8% for 4 Wks in IRI; Mix Shifting Back? – CRAFT 4/2/21 If you haven't yet braced yourself for the oddness of off-premise reporting coming our way in 2021 (including some seriously tuff trends), now's the time. Craft $$ sales still up 10.7% yr-to-date thru Mar 21 in IRI multi-outlet + convenience data. But down 0.8% for 4 wks as segment, category or entire channel starts to lap pantry-loading boom in back half of Mar 2020. Recall, that load-up largely focused in grocery channel, as c-store trends didn't start hitting double-digit gains til Apr 2020. So grocery trends most impacted by comps so far: craft $$ -8.3% in foodstores for 4 wks in total beer category that's off 7%. Craft still gaining share in convenience channel, $$ +17% for 4 wks to 3/21. Craft lost 0.4 share of beer $$ to 11.2 in IRI MULC this period. Still holding on to slight share gain YTD. 

Part II of Craft Update 2021 Webinar Series Less Than 4 Wks AwayDon't miss Craft Update 2021, a two-part, data-filled, deep-dive report and lively webinar presentation from Beer Marketer’s Insights. Part II is less than 4 weeks away, coming Wednesday, April 28 at 1pm EST. Get an up-to-the-minute overview of where US craft beer stands as it recovers from the COVID-19 outbreak, along with in-depth analysis of 2020 state and market level data you can't get anywhere else. Find more details at beerinsights.com and sign up today!


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 Craft Update 2021

By Beer Marketer’s Insights
Presented by Chris Shepard & David Steinman,
the Editors of Craft Brew News
March 3, 2021 - Part 1
April 28, 2021 - Part 2
1pm Eastern Time
90-minutes including Q&A

Click Here to Register