Mega-Brewers Profit From Utah’s Strong Beer Law But Craft Beer Suffers

It’s almost counter-intuitive that craft brewers would be the losers when Utah rewrote its century-old alcohol laws and allowed stronger beer in grocery stores.

But while  large brewers like Anheuser-Busch and Molson Coors are reaping the profits, craft brewers, whose beers tend to be stronger than brands like Budweiser, still can only be sold at the state’s DABC (Department of Alcoholic Beverage Control) stores.

Let’s start with the obvious…

The legislation that was dubbed the “Strong Beer” bill and enacted in November 2019 wasn’t  really about strong beer at all.

What it did was put an end to one of the nation’s last 3.2 beer laws which limited grocery store sales to beer that did not exceed 3.2% alcohol by weight (4% beer when using the more standard “alcohol by volume’ designation).

Utah, which historically isn’t a heavy drinking state consumed 29% of what 3.2 beer was being produced at that time.

Home to a large Mormon population, who abstain from alcohol all together, the state still represents less than a half a percent of all beer drinkers in America. But for big brewers like Anheuser-Busch and Molson Coors producing 3.2 beer for states such as Utah was increasingly time-consuming and costly.

So it’s no surprise that those big beer companies lobbied heavily for the state’s archaic laws to be changed. And also no surprise that they were happy with the “Strong Beer” bill’s enactment, which capped grocery store beer sales to those that exceed 5% alcohol-by-volume (ABV) allowing for the sales of almost all the big beer companies most popular brands.

The only losers were Utah’s craft breweries with their higher than 5% ABV beers still only allowed to be sold at DABC stores. Outlets that are now seeing less traffic, due to the pandemic, and consumers that can now get their Budweiser at grocery and convenience stores.

“Since Nov. 1, 2019, Utah’s craft brewers have watched their liquor store sales drop by more than 40% according to the Trumbull Times.” “They’ve also paid the state more in excise taxes. The price per barrel jumped from $12.80 — already the highest in the nation — to $13.10 when the law went into effect.”

Arguing that raising the maximum alcohol content of grocery store beer to 5% ABV primarily benefited the mega brewers, the Utah Brewers Guild actually predicted a large drop in sales when the beer law was proposed.

But the guild’s efforts where no match for a coalition that included large grocery store chains, distributors and big beer companies.

“It’s worse than I thought it would be,” said Peter Erickson, co-founder of Epic Brewing Co. in Salt Lake City told the Times. “Even before COVID, we laid off 25 people, mostly due to the lost sales at the Department of Alcoholic Beverage Control stores.”