Can beer hop from craft to corporate?

The craft beer industry is abuzz with the news of two multinational beverage companies, Anheuser-Busch (AB) InBev and United Breweries, which control three-fourths of India’s beer sales, stepping in with new wheat-based products. While AB InBev, which sells the crowd-pleaser Budweiser, is selling its “crafted wheat beer" through 7 Rivers Brewing Co., United Breweries will introduce its “locally produced wheat beer variants" by the end of the year.

To put it simply, these firms are creating a craft beer variation they hope will help them enter this growing market. Speaking to Lounge over the phone from Bengaluru, Debabrata Mukherjee, chief marketing officer of United Breweries, says, “It is an offering for a set of consumers who are looking for a differentiated product with a crafted set of ingredients." The differentiating aspect can vary from malt to hops, he adds. AB InBev’s canned beers, Veere and Machaa, were introduced across 300 outlets in Pune and Mumbai mid-November. They are priced at ₹140 for a 330ml can.

Shivam Naik of Goa Brewing Co. at the Tapped beer festival in Mumbai on 24 November (Photo: S Kumar/Mint)

But can these qualify as “craft beer", which implies an essentially artisanal quality, or do they fall short?

According to the Craft Brewers Association of India (Cbai), there are approximately 200 craft breweries, which make a variety of speciality handcrafted beers in small batches with premium ingredients like barley, wheat, rice, fruits and herbs, often directly sourced from farmers or cottage industry suppliers.

“As a thumb rule, Cbai says a brewery must produce up to 250,000 hectolitres per year to qualify as craft. They must be independently owned and not more than 25% owned by big breweries or private equities," explains Gaurav Sikka, managing director, Arbor Brewing Company, and a Cbai office-bearer. In the US, craft breweries are certified by a seal of differentiation. Sikka says Cbai may introduce a similar marker to ensure proper representation for craft as lines blur.

COLD CHAINS FOR FRESH BREW

Craft brewers and drinkers swear by freshness, therefore proximity to the brewery and storage is imperative. Can big-brand manufacturers replicate these processes and flavours?

Fresh Brews

“Craft beer is not just beer on tap. It can be packaged and the shelf life is about six-nine months," says Sikka. They have an iconic brewery in Bengaluru but they also sell canned craft beer like Indian pale ale and a honey-with-lavender flavoured strong version in Karnataka and Goa.

When craft beer is transported over long distances, a superior standard of cold chain is needed to maintain freshness and quality. But there’s no cold chain infrastructure for craft beer distribution in India. It’s a big challenge, adds Sikka.

Over the last five years, the Indian craft beer market—developed by microbreweries as well as brands like Bira, Simba and White Rhino—has found ways to trendily package beer in kegs, bottles and cans. It has drawn in younger beer enthusiasts and created cult followings, even if total sales—approximately 2-3%—are a tiny percentage of the overall beer market.

Bigger companies now want a piece of the pie. AB InBev is also setting up premium microbreweries in partnership with Taj Hotels, with the first one coming up at a Taj property in Bengaluru next spring. Meanwhile, BrewDog, the Scotland-based independent brewery, plans to start retailing in India in a few weeks. Their superior cold chain will maintain the quality of beer from the plant to retail outlets in India, they claim.

Will the big daddies of beer be able to appeal to craft beer lovers? That remains to be seen, but craft beer in India is certainly poised for interesting times.