Look Homeward, Shortage
First, we had the great toilet paper shortage of 2020. Next, came the great coin shortage. Is there a national aluminum shortage in 2020 in the US? All signs point to yes. But what does the national aluminum shortage mean for the craft beer industry?
Laura Reilly of The Washington Post indicates in an article that the US market alone has a national aluminum shortage of 10 million beer cans. Have you heard of such a thing? How does it affect Shore Craft Beer? According to one local brewer in Ocean City, Backshore Brewing Company, the rumors are unfortunately true.
Backshore Brewing and Hoop Tea’s Reponse
I reached out to several local breweries to talk about the national aluminum shortage. I heard back from Danny Robinson, who owns “Backshore Brewing as well as the Hoop Tea brand of spiked iced teas, which was borne out of Backshore and is now distributed in 6 surrounding states.” He answered several questions about the aluminum can shortage and its impact on his brewery.
Since the distribution for Backshore’s beer products is contained to their boardwalk brew pub, there are minimal negative effects so far.
However, because Hoop Tea is distributed and sold in several surrounding states, there have been some effects for it.
Backshore Answers the Aluminum Shortage
Danny says Backshore currently produces less beer; they also made a strategic decision to order their can package one year before putting the beer in them.
For Hoop tea, Danny uses an innovation called “party pouches.” They have three liters of volume and have a spout feature. This packaging novelty makes the item a ‘grab and go’ item for consumers. It resulted from difficulty in getting local bars and restaurants to add Hoop Tea to their array of taps.
While craft beer had a strong presence at local bars and restaurants, Danny wanted to simplify the task of adding a new tap for bar owners, thus making it easier to offer the product and without sacrificing bars’ current tap offerings.
Danny observed wine companies using similar packaging, and as a result, he made Hoop Tea the first malt beverage company to employ the pouch packaging. Danny says the pouches are a consistent top seller and are now integrated seamlessly into the brewery’s brand.
“Years ago we were the first beer product to introduce flexible pouch packaging into the market, and this may insulate us somewhat from the challenges of sourcing cans.”
Preparing for the Shortage
While Danny is not clairvoyant, he and Backshore had an inkling about a potential upcoming shortage. Based on his knowledge of the aluminum market and its recent volatility, he and Backshore decided to look into alternative packaging methods and materials.
For long-term strategy, Danny says Backshore has “all materials, regulatory approvals, and orders prepared to quickly shift away from aluminum cans if necessary. We can package our liquid in bottles, pouches, and even cardboard cartons if we have to in a pinch.” Quite impressive!
I asked Danny if COVID-19 had compounded the shortage, and he responded in the affirmative. People in general are not going out to bars, restaurants, or large gatherings. They mostly enjoy their alcohol consumption from the comfort of home.
That consumption shift translates to fewer consumer purchases of draft kegs and bottles, which means consumers purchase more cans. Thus, the demand for aluminum is higher. In addition, consumer alcohol consumption on the whole is up, which adds to the shortage.
Hope for the Future
The forecast isn’t all doom and gloom, though. Danny thinks based on consumer trends, there may be a shift from aluminum cans. A similar trend emerged when consumers moved away from using glass bottles in the past few years.
He also believes that differentiation is key to success for remaining in what he calls the “crowded market.” Alternative packaging will drive the movement away from aluminum usage, which dominates the market currently.
Has the aluminum shortage affected your consumption or your brewery? We’d love to hear your story, so please share!