The only authority for all things beer…
Fortune Contributor, Tara Nurin (Thanks to Mike Pearlman for the find!)
In the highly competitive world of seasonally released beers, Elysian Brewing might be considered the Great Pumpkin. Since opening in 1996, the Seattle-based manufacturer has produced several dozen pumpkin brews, including the peach pumpkin ale that Budweiser mocked in a now infamous Super Bowl commercial nine days after the announcement that its parent company, Anheuser-Busch InBev, had purchased the craft darling.
But unlike the Great Pumpkin of Peanuts character Linus’ dreams, Elysian does deliver on its pumpkin promises. Fans waiting for the brewery’s usual line-up of about a dozen styles will not be left waiting in vain; they can buy four packages across the country and eight on tap at the company’s brewpubs and festivals, including Elysian’s annual Great Pumpkin Beer Festival.
But this brewery’s keepers of the faith are the lucky ones this pre-Halloween season. Many other consumers of gourd beer are going to make some sacrifices.
As I chronicled in a February 2016 article, brewers were caught completely off-guard late last year when sales of the once cultish style rotted away like a jack-o-lantern on a tropical Christmas afternoon. The problem: overproduction, oversaturation, underwhelming craft growth and overly hot autumn temperatures. Those woes were caused, in turn, by increased volume at established breweries, new breweries trying to cash in on the craze, fewer drinkers entering the market, and, well, climate change. For the first time, mass quantities of pumpkin beer sat on the shelves months past their sell-by date and a lot of breweries, wholesalers and retailers lost money. Many declared sudsy pumpkins a dying trend and decided to cut production this year.
Now it’s mid-September. Most craft brewers have finished their 2016 pumpkin run and trucked it out to their distributors.
Did they cut production? Yes — many of them drastically. That is, if they produced any pumpkin at all.
“Ithaca [Brewing] has discontinued its pumpkin, as has Shock Top (an Anheuser-Busch InBev product),” says the owner of an East Coast AB InBev distributor who didn’t want to use his name. “We knew the market had kind of hit the wall last year.”
Samuel Adams produced one instead of two pumpkins this year. Pumpkin powerhouses Harpoon Brewery, Southern Tier Brewing and Shipyard Brewing all produced less volume, as did four Philadelphia-area breweries contacted at random.
“Finding our pumpkin on the shelf in May in a prominent grocery drove us to this decision. The beer landscape is changing,” says Scott Rudich, owner of Round Guys Brewing in Montgomery County, PA, which will produce around 800 barrels (1 BBL=31 gallons) of beer this year and cut pumpkin from eight batches to just one. He says his sales staff and distributors also requested the reduction.
The anonymous East Coast distributor says he thinks he ordered about 20% less pumpkin this year than last.
“Across the board I can’t think of a single brand from which we have ordered more pumpkin,” he says.
Likewise, the distributors Easton, PA,’s Weyerbacher Brewing works with reduced their orders and the brewery chopped pumpkin production in half, just as “Intergalatic Sales Manager” Bob Fauteuxpredicted in February. This, from a company that last year counted on its Imperial Pumpkin Ale for 15% of its annual sales.
“The market changed so drastically last year and we didn’t want to be in that business where we have too much out,” says Fauteux. “We realize the market has shrunk and will never be what it was.”
Fred Forsley, owner of Maine’s Shipyard Brewing, makes a whopping nearly 40% of his money on the pie-spiced Pumpkinheadand its high-alcohol (AKA “imperial”) version, Smashed Pumpkin. His sales dropped approximately 10,000 barrels last year. Instead of continuing to follow the industry norm by producing the entire supply at once, this year he’s going to brew batches incrementally based on what the market will bear. He thinks the overall reduction in national supply will actually help save the seasonal style. With fewer companies producing fewer SKUs and fewer barrels in competition for a finite amount of tap and shelf space, he believes survivors should be able to stay solvent.
2016 is Forsley’s year to make drastic moves. In an effort to start reversing an ever more insidious trend called “seasonal creep,” he’s not releasing his pumpkin-spiced beers until the season for which they were originally intended: autumn. Distributor demand and brewery capacity constraints have forced many breweries to sell pumpkin beer earlier and earlier. Weyerbacher, for example, hit stores in New Jersey on July 11 and everywhere else less than a month later. Sam Adams, notorious for encouraging seasonal creep by selling its spring seasonal on January 1, has often been first to market, even ahead of Weyerbacher.
Marking the first time a major brewery has refused to play along with that game, Shipyard is recalibrating its release schedule to put pumpkin beers back on the calendar where they belong: in the fall and winter. Calling the 15-year-old Pumpkinhead brand a “perfect Christmas beer,” Forsley initially released in it September. Now, sick of delivering a cold-weather beer to distributors in July, he held on to his early batches until the third week of August and consumers should be seeing it on shelves by this week.
By doing so, he’s not only shifting the time/space paradigm for pumpkin but perhaps for other seasonal styles, too. Basically, he’s making extra money off his summer beer by continuing to sell it through the end of summer (“The people coming off these cruise ships,” he says, looking out over Portland’s port on an early September morning, “they want a lobster and a summer beer.”) and he’s developing an aggressive marketing campaign to convince distributors and retailers to keep stocking Pumpkinhead and Smashed Pumpkin until year’s end.
“It’s nerve-wracking when you have customers emailing you telling you they want the product,” he said a few weeks before said product hit the street. “It’s kind of real time right now.”
But he reports some of his distributors as relieved and are confident they won’t have to pick up any out of code product.
Though he didn’t comment on the Shipyard plan specifically, the East Coast distributor says he’s an anomaly in that he doesn’t want pumpkin beer in his warehouse before August 1. He’ll store it for later sale when asked by breweries that don’t have room to keep it themselves but in turn asks them to let him wait to pay until he sells it to his accounts.
“They usually say yes because otherwise they know they’d be tying up my cash flow,” he says.
Boston’s Harpoon is shortening its pumpkin sales cycle this year, though several breweries contacted for this story said they’re not making any changes to their release schedule. Some aren’t tweaking production, either, and a New Belgium Brewing sales rep who says the Colorado brewery has increased volume says it’s only to meet demand in a distribution footprint that includes four new states.
The sole outlier seems to be Delaware’s Dogfish Head Craft Brewery, revered for its Punkin Ale. Though the brewery normally holds its release until September 1, it sold as early as August 8 this year to be available to liquor stores that set up its pumpkin displays that week. Citing strong sales last year, a brewery spokesperson says brewers also pumped up the volume, though no one was available Friday to say whether anticipated end-of-year growth into new states bore any responsibility for the increase.
Pumpkin beer’s loss could make for another seasonal’s gain. Other brewers will almost surely follow Forsley’s lead by extending summer beer season through summer, and instead of crying over spilled beer, some brewers are already looking to capture revenues from a growing interest in lagers by adding or showcasing the amber-hued Vienna lager or Marzen styles associated with Oktoberfest, which drinks nicely regardless of the weather.
However, the same won’t necessarily hold true for every seasonal style, especially the popular, rich, sweet one that’s cold-weather dependent and could just become another victim of its own success.
Says Luke Bowen, co-owner of suburban Philadelphia’s Evil Genius Brewing, which kept its pumpkin production at last year’s levels: “Pumpkin sales are still strong compared to other seasonals, like spring. But they are definitely weaker overall. I fear the same will be true for holiday beers for many of the same reasons.”