Craft Brew News

2/21/2020

(Courtesy of Brewbound.com)

Credit Suisse, Evercore ISI Project Further Hard Seltzer Growth

The hard seltzer category could reach about 10% of the beer market in the next few years, according to research reports from two leading financial services firms.

Earlier this week, Credit Suisse managing director of equity research wrote in an analysis of Truly Hard Seltzer maker Boston Beer Company that the firm expects “seltzer to double this year,” and grow to between 8 and 10% of total beer industry volume by 2023. He added that hard seltzer currently makes up 2.6% of the beer industry’s volume share.

Category leaders Mark Anthony Brands’ White Claw Hard Seltzer and Truly both encountered out-of-stock issues in 2019, which hindered their growth and yet the seltzer category more than doubled last year, the report continued. To remedy this, both companies have invested in increasing capacity, including Mark Anthony constructing a pair of new facilities.

According to Credit Suisse, Truly could account for 5 million barrels, or 60% of Boston Beer’s portfolio by 2023. The brand could also make up more than half of Boston Beer’s earnings.

Bud Light Seltzer launched in January and sold nearly 200,000 cases in U.S. off-premise multi-outlet and convenience stores through January 26, according to market research firm IRI. Anheuser-Busch InBev supported the launch with a Super Bowl ad starring rapper Post Malone as well as $23 million in advertising.

Corona’s seltzer is expected to launch later this quarter.

FIFCO USA Abandons Pura Still

FIFCO USA has stopped production of Pura Still, the 95-calorie, 4.5% ABV spiked still water brand after less than two years, according to a memo sent to wholesalers this week.

“Pura Still has had an uphill battle competing against high demand seltzers and flavored malt beverages that are in established and growing categories,” chief sales officer Josh Halpern and beyond beer director Jennifer McCauley wrote in the email.

FIFCO USA will redirect its focus and financial support to its established Seagram’s Escapes brand, citing that franchise’s decade-plus of growth.

The news of Pura Still’s demise came as a bit of a surprise, following FIFCO USA’s national sales meeting in November where McCauley urged wholesalers to stick with the brand despite “fatigue.”

In the message to wholesalers, FIFCO USA also touted the upcoming launch of a Seagram’s Escapes 100-calorie Tropical Rosé flavor, which will be promoted by Chris Harrison, the host of The Bachelor.

PicoBrew in Receivership, Up for Sale

PicoBrew, maker of in-home beer-brewing appliances, has entered into receivership after failing to secure additional funding, according to food and tech news site the Spoon.

Co-founder and CEO Bill Mitchell told the outlet that the company had taken out a bridge loan from new and existing investors but needed to secure additional funding in December. When PicoBrew could not close that funding round, the bridge investor group called the loan and forced the company to find a buyer.

Mitchell said he expects the investor group to buy the company, barring any higher bids.

PicoBrew’s products include the Pico C and Pico Pro for homebrewers and the Z Series for commercial use.

Iron Heart Canning Acquires Michigan Mobile Canning

Iron Heart Canning, the country’s largest mobile canning service provider, announced today an agreement to acquire Michigan Mobile Canning.

Iron Heart, headquartered in Manchester, New Hampshire, operates 50 canning lines from 24 locations from Maine to Florida. The addition of Michigan Mobile Canning’s two locations in Kalamazoo, Michigan and Indianapolis, Indiana will extend Iron Heart’s reach into Illinois.

Founder and CEO Tyler Wille said in a press release. “We are extremely excited about the opportunity to bring our industry-leading canning services and expertise into the Midwest Indiana, Michigan and the greater Chicago area are incredible markets in the craft industry, and we are eager to begin building new partnerships within the region.”

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