Will Marijuana Stop Beer’s Declining Sales?

The Motley Fool, a multimedia financial services company with stock analysts who watch the beer biz closely, recently published an article entitled Can Marijuana Stop Beer Sales From Falling? And it certainly didn’t pull any punches.

In it, Motley Fool’s Rich Duprey takes on the growing number of big brewers that are partnering with legal weed producers in the hope of reversing declining beer volumes….

But while Duprey freely acknowledges that cannabis beers have “arrived,” he questions whether their arrival is more a fad than a trend…

“Brewers often latch onto gimmicks, like ice beer, imperials, nitros, the oxymoronic black IPAs (it’s an India pale ale after all), or the new New England IPAs that are cloudy rather than clear. You can still find these beers on store shelves, but their heyday has largely come and gone.”

“Although marijuana-infused beer appears to be another publicity stunt that will eventually fade away to become a niche product, this time brewers are paying tens of millions of dollars — sometimes hundreds of millions — for the privilege.”

Last August Constellation Brands (home to Mexican beer leaders like Corona and craft properties like Ballast Point, Funky Buddha and Four Corners) upped its stake in Canopy Growth a major cannabis producer from 9% to 38% in a massive $3.8 Billion deal.

In October MolsonCoors finalized a joint venture with HEXO, (a recreational cannabis subsidiary of Canada’s The Hydropothecary) to form a standalone company that would develop new non-alcoholic, cannabis-infused drinks north of the border.

The future?

And just before Christmas, Anheuser-Busch InBev, the world’s largest brewing company and home to Budweiser and Bud Light, announced that it would be partnering with Canada’s Tilray to research non-alcohol beverages containing both the mind-altering THC compound, and the health promoting CBD.

So this thing is clearly on but Duprey is not that sure the trend will find the same audience or a lasting audience at all.

Explaining that drinking a cannabis beer is not the same as an alcohol experience, or even an alcohol with pot experience, he remains skeptical about cannabis beers’ long-term prospects…

 “Near-beer has never been a particularly popular category, and adding psychoactive properties to it seems to be at odds with near-beer’s purpose. Although there are supposed to be certain health and wellness attributes associated with THC, it doesn’t mean people will prefer to drink their weed rather than smoke it.”

(Pot Beer Image Credit: Mitchell Maglio)

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