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Brauereisterben: The Death of German Brewing

02.04.2013 12:23 PM

Is there any pleasure quite as enjoyable as a tall stein of Warsteiner Premium Dunkel? Some may prefer Ayinger, Bitburger, Paulaner, Spaten, or Franziskaner, but there is no disputing the fact that the Germans know how to make truly fantastic beers. Many of the new beers our American microbreweries have been churning out are inspired by German styles like the Hefeweizen, Weizenbock, Kölsch, Pilsener, and Doppelbock. Thanks to Reinheitsgebot, a German beer purity law dating back to the 15th Century, the high quality and reputation of Germany’s beer has remained intact for centuries.

Yet, trouble is brewing in Germany. The culture is changing, prompting some to say it’s the death of German brewing.

We know what you’re thinking. “How can this be? Germany is the home of Oktoberfest, the biggest drinking holiday the world has ever known!” While that much is true, one need only look at the statistics to see that beer drinking has actually been in decline for quite some time.

The Facts:

  • More than 41 large breweries and 182 medium-sized breweries have closed since 2000.
  • Berlin had 700 breweries in the early 19th Century. Today, there is only about a dozen.
  • The brewery workforce lost 11,000 jobs from 2008-2010.
  • Germans consumed 150 liters per capita in 1970. Today, they consume 106 liters – a 30% decline.
  • Germany is the 5th-largest producer of beer, down from its #2 spot it enjoyed in 1990.
  • 5/6 German beer producers are now owned by one of the global majors.
  • There are no German beer brands selling in the “Top 20” of any foreign nation.

The Murky Truth:

There are many possible explanations for the decline, says a recent Wharton article:

  • The population is becoming more health-conscious, with more water than beer consumed.
  • Penalties for drinking and driving have dramatically stiffened in recent years.
  • Laws have been proposed that may ban drinking in public spaces and on mass transit.
  • The beer drinking population is aging and the key 18-34 age group is declining.
  • Younger Germans prefer “beer colas” and high-end wines, which they view as “classier.”
  • The old adage "Das bier ist gesund, zu jeder Stund" ("Beer is healthy at any hour") is now frowned upon.
  • Germans only export 15% of their beer – which is a smaller percentage than Holland exports.

To Reinheitsgebot Or Not To Reinheitsgebot?

Purity laws have indeed made German beer great. Yet, some argue that these archaic mandates may now be working against the industry’s best interests. For starters, did you know that only 6 local Munich breweries are allowed to sell at the annual Oktoberfest event? This pushes smaller brewers even further to the fringe and prevents them from reaching an international audience for their beers.

Furthermore, the Reinheitsgebot prevents German brewers from any experimentation. Beer must be made using nothing more than water, barley, and hops. As a result, German brewmasters are currently working with 20 styles of beer, versus the 100+ American brewers have at their disposal. The culture of new and innovative microbrews is not quite as celebrated as it is here in America. Their emphasis is more on longstanding tradition and heritage. Germans would rather drink “spülwasser” (dishwater) than a weird foreign concoction like a fruity Belgian ale. If Germans wish to experiment with different flavors, they switch to cocktails, wines, or alco-pops (which now accounts for 4 percent of alcohol sold in Germany.)

Is There A Future For German Beer?

For years, the Germans have been very insular with their beer traditions. If people wanted to experience German beer, they could simply come to Germany, it was presumed. There is enough local demand to keep the German beer industry afloat forever, it was believed. Yet, the price of beer has been dropping since 2008, along with the diminishing demand. Part of the problem is attributed to oversaturation. There are 1,341 small breweries producing for German citizens. Most of these small family businesses do not have the money to invest in global brand placement.

Josef Kronast, brewmaster at Maxlrainer Brewery, surmises that, eventually, Germany will fall lockstep with global trends and wind up with 3-5 dominant brands, plus a handful of independents. What they need is a global image, says Wharton. Germany should be to beer what France is to Champagne. They need to capitalize on emerging economies like Russia and China, which will pay a higher price for quality beer. They need to ensure that all beers labeled as “Bavarian” are, in fact, made in Bavaria. Marketing campaigns need to show beer in a more opulent light, rather than allowing this misperception that beer is “cheap” and “low-brow” to persist.

According to Slate magazine, there is some evidence that German breweries are taking initiative to modernize their enterprises. For instance, Schneider collaborated with New York’s Brooklyn Brewery to produce a strong Germanweizenbockdry-hopped with American flowers and a Hefeweizen dry-hopped with local German Saphir hops for a unique floral and citrus flavor alien to local palates. Both varieties are enjoying growing popularity in the US and Germany. In other news, Wernecker Bierbrauerei is releasing American-style IPAs – and the brewery has doubled in size over the past decade. Weyermann Malting is experimenting with “rule-breaking, yet familiar” beers with specially roasted grains, cherry ales, pumpkin ales, barley wines, and imperial American ales to “show the world, and German brewers, what is possible.”

Perhaps it’s not the Brauereisterben at all. It could be just the beginning.

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