THE POPULARITY OF CRAFT BEER HAS SKYROCKETED FROM AN ENTHUSIAST’S SIDE HOBBY TO A GLOBAL REVOLUTION, ONE THAT EVEN HAS THE BREWING GIANTS TAKING NOTICE.
THE POPULARITY OF CRAFT BEER HAS SKYROCKETED FROM AN ENTHUSIAST’S SIDE HOBBY TO A GLOBAL REVOLUTION, ONE THAT EVEN HAS THE BREWING GIANTS TAKING NOTICE.
WITHIN A MERE half hour, Danny Wong – with push-pull rule in one hand and dark grey sweat plastered on his back – has, for the fifth time, reorganised the makeshift tables at The Bottle Shop in Sai Kung, Hong Kong to realise the interior layout of his upcoming bar and restaurant. It is summer 2014 and aside from manning his shop, Wong has been spending most afternoons crouching over his sketches – a skill he acquired as an architect in Australia.
Fast-forward a year later, what was only his imagination has manifested into the eclectic Little Beer Room just off SoHo that doubles as a retail shop on one side selling customer favourites like wines, spirits, take-out growlers and beer paraphernalia such as branded t-shirts and glassware.
The much-anticipated opening was followed by Coedo Taproom in July 2015; BrewDog in the beginning of this year; and even Coaster, a citywide niche magazine that covers everything from beer reviews and local brewpubs to home-brewing.
Though a relative late-comer into the craft-beer scene (Danish brand Mikkeller opened in Bangkok back in early 2014 while The Craft Beer Association measured close to 250 microbreweries in Japan last year), Hong Kong’s landscape is indicative of a region so thirsty for what had originally been a side hobby for beer enthusiasts – a burgeoning demand that haunts even the mega-brewing giants.
In 2007, Asia topped the world’s beer consumption – in 2011, we drank 67 billion litres of frosty, a whopping 10bn more than the Americas and 16bn more than Europe. So it’s no surprise when Thailand and Taiwan were named the fastest-growing export markets in 2015 for American craft beer, which, according to the Brewers Association, is defined as a product of a microbrewery that has an annual beer production of six million barrels or less.
According to Allied Market Research’s latest World Beer Market – Opportunities and Forecasts, Asia Pacific is expected to garner about US$202.4 billion in craft beer sales by 2020 with an expected compound annual growth (CAGR) of 7.3 per cent from now until then. Attributing to a rising middle class, swelling disposable income, a preference for local, small-town produce over that of soulless mega-corporations, as well as a hike in younger – especially female – consumers drawn to new packaging, brands and flavours, craft beer became what the cool kids drink in Asia.
Wong says the craft beer evolution boils down to a cultural shift, one that is similar to that of speciality coffee. “Thirty years ago, you wouldn’t find espresso bars; we drank instant coffee, or coffee from the pot. At the end of the day, it’s a culture that we’re trying to promote, to get people tasting and trying and hoping that they’ll switch over if they’ve tried something good.”
He dates Asia’s craft-beer boom to four years ago, when expats started bringing over their favourite drinks from home or their travels.
“Grassroots then took this concept and became even more active with forums, blogs, and reviews of pairings with Asian cuisine, for example. So, it was a market that was able to sustain itself,” he says, linking craft beer’s popularity to active social media users as well as events such as The Asia Beer Cup, which has taken place annually in Japan since 1998; Singapore Craft Beer Week, Beerfest Asia and Craft Singapore Festival; the China Craft Beer
Conference & Exhibition; and Hong Kong’s Beertopia, to name a few. Yet, craft beer has evolved into much more than an expat’s game.
Much of its popularity in Asia stems from locals’ curiosity for home- grown beer, especially those made with regional ingredients like red dates (such as the Taiwanese Le Blé d’Or); baijiu yeast, cumin and chestnuts (in the Beijing-based Jing A); as well as kumquats, osmanthus, chrysanthemum, roselle, jasmine, Chinese yam, orange peels, lily bulbs, dong quai and even Sichuan peppercorns (present in Hong Kong’s Moonzen) – ingredients that are familiar staples yet interestingly foreign to beer making.
“Yes, Rogue and Millstreet, for example, are very popular worldwide, but it doesn’t mean anything to the consumer if they haven’t had it elsewhere,” says Beertopia founder Jonathan So, who witnessed a 10-fold increase in turnout last year compared to when his event first launched in 2012, only whereby 1,200 people showed up. “Hong Kong breweries are very popular at Beertopia. Three years ago, that wasn’t really the case, it was still very much a part-time hobby for a pilot. But there came a boiling point where people realised it’s a viable business, and Hong Kongers are really embracing that, they’re curious.”
Wong, whose customer base is half dominated by locals, adds that the engine for home-brewed brands is further propelled by the city’s retailers. “Believe it or not, Hong Kongers are very supportive of their own labels, which opens up to a lot more audience.”
So despite Asia still being at the infancy stage compared to the West’s familiarity with craft beer, it’s no surprise that the brewing behemoths want a slice of the pie, especially in developing markets: Asahi scooped up Laverton in April 2013, followed by Mountain Goat last September; Heineken bought a 50-per cent stake in US-based Lagunitas Brewing Co. while Kirin purchased a 30-percent-plus stake in in Yo-Ho Brewing. In April, Bavaria acquired a 35-per cent stake in Dutch label De Molen. Even if the giants are not dabbing into the craft beer businesses, they’re pumping out pricier premium lines to upsell craftmanship: Kirin opened its Yokohama Beer Village; and Miller Coors launched Blue Moon.
A brand that continues to brave against the tides is Japan’s Baird Beer – a long-time craft brewer with more than six taprooms around the country since launching in 2000. The reason? “Attitude,” says Founder Bryan Baird.
“There are probably as many nuanced views on [selling out] as there are craft beer market participants. Craft beer, in my view, is about an attitude and an orientation, which is not in the DNA of an industrial brewer. They can purchase and ape real craft breweries but they can never be one,” he says, though admitting that his biggest challenge is to grow at a rate that supports the big infrastructure investment he made recently without compromising.“The craft beer market in Asia is emerging and will eventually explode.”
True, selling out would undermine the sense of community that comes with craft beer, but it’s also the best way to promote and distribute the brand. “There’s beer that’s mass-produced on a huge, huge scale, and then there’s beer that’s made with passion and creativity by people who oversee and taste every batch and are putting forth something they love; as cheesy as that sounds. That’s the craft beer market that goes along with it,” says So. “For me, I just want to see better beer everywhere without having to go out of my way to find a special bar. I’d like to sit down and have a quality drink with my meal.”
Back at the Little Beer Room, the floor is buzzing with a steady crowd on a Wednesday evening. “Craft beer will only be more widespread here. If we don’t react, we’ll only be left behind like Kodak in face of the digital camera shift. At the end of a day, craft beer is just a business, but quality products will break through,” Wong says.
