Ten months into his tenure as Beer Institute (BI) president and CEO, Brian Crawford said the trade organization and the overall industry have made many strides, but still face several challenges.
Crawford cautioned that the founding principles established by the BI in 1862 – limited government intervention, lower taxes and free enterprise – are “facing headwinds” that put those organizational pillars “in danger.”
Crawford stressed that the industry’s leaders and trade groups must work together to “face those challenges” and the BI is less reactive in the face of those issues.
“We need to be eyes wide open about the challenges that we face,” he said.
Those challenges range from the spirits industry’s efforts for greater market access, to neo-prohibitionist government policies, to aluminum tariffs.
“We need to stop focusing on ourselves and focus on the real challenges that we have,” Crawford said.
BI Seeks Voice in Alcohol Health Policy Debates
Crawford stressed that the BI is seeking a voice in governmental agencies’ efforts to mandate how much or how little consumers can drink.
Crawford warned that the World Health Organization’s position that there is no safe level of alcohol consumption and recommendations of no more than two drinks a week in countries such as Canada “are coming to our shores.”
“In 2025, the dietary guidelines are going to be updated jointly between the HHS [U.S. Department of Health and Human Services] and the USDA [U.S. Department of Agriculture],” he said. “The BI, the BA [Brewers Association], the NBWA [National Beer Wholesalers Association], we are united in addressing these and making sure that beer’s voice is heard in these discussions.”
The trade groups are seeking transparency in the process and stakeholder input, and are basing the policy on sound science, Crawford said.
Additionally, Crawford and the BI take issue with the Biden administration’s review of competition in the beer industry. The organization’s position, Crawford reiterated, is that “there’s more competition in beer than ever before with 9,000 breweries across the country.”
Beer Beating Spirits Industry’s Market Expansion and Tax Rate Reduction Efforts
Crawford called on the beer industry to speak with a singular effort in its battle against the spirits industry’s efforts to increase market access and lower excise taxes for spirits-based ready-to-drink offerings.
The beer industry is facing an “army of liquor lobbyists” on the federal and state levels who “are relentless in their pursuit to lower their taxes and increase their access to the detriment of everyone in this room,” Crawford added.
Thus far, the beer industry’s top lobbyists have beaten back those efforts, with Crawford saying the Distilled Spirits Council of the U.S. (DISCUS) gets a “failing grade for their efforts in 2023.” However, Crawford said the end goal for the spirits lobby isn’t lower taxes, but “recruiting consumers to their higher ABV premium products.”
“It’s a Trojan horse strategy, and we’re calling them out every step of the way,” he said.
Aluminum Tariffs Not Going Away
Beyond battles with the spirits industry, the BI is focused on repealing the Section 232 aluminum tariffs implemented by the Trump administration and maintained by the Biden administration. Crawford admitted that the tariffs “are here to stay.”
“We don’t see a path forward in removing the 232 tariffs,” he said. “That doesn’t mean we’re not going to continue to talk about it.”
As part of a shift in strategy, the BI will launch a website and explainer video later this month on how the Midwest Premium pricing structure for aluminum works. By calling it out, Crawford said the hope is lawmakers will engage on the issue.
BI Seeks More Congressional Champions, PAC Donations
During the meeting, Crawford shared a slide showing past “Beer Champions” who are no longer in Congress. Crawford stressed the need for new champions in Congress. As such, the BI is seeking 50 donors to donate $50 to its BeerPAC political action committee in order to make it a multi-candidate PAC.
“We’ve got to grow our PAC,” Crawford said. “We’ve got to grow our voice in Washington.”
To bolster those efforts, the BI is bringing back its hill climb February 27-29.
A-B CEO: Collaboration, Regulatory Pushback, Differentiation Key for Industry
Anheuser-Busch North America CEO and Beer Institute chairman Brendan Whitworth laid out three themes for beer industry leaders:
- Collaboration;
- Protection against unfair regulation and unnecessary taxes;
- And differentiation.
“We compete vigorously in the market each and every day, but we all benefit from a vibrant and exciting industry,” he said. “And the only way to get there is collaboration.”
Whitworth cited collaboration among the beer industry’s three major trade associations, the BI, the BA, and the NBWA as an example of working toward a shared “vision of a vital industry.”
In regards to regulation, Whitworth said there are “guideposts” already in place in this regulated industry. Additional regulations, whether they are direct taxes or implied taxes, such as tariffs, are unnecessary and prevent brewers from investing in their businesses and creating jobs, he said.
Finally, Whitworth said beer companies must differentiate themselves from spirits producers.
“We think beer is proudly different: It needs to remain different,” he said. “And we need to put forth the efforts to make sure that we remain [different], whether that be taxation, whether that be access to channels and all sorts of things underneath that envelope.”
Other notes:
- The BI presented the Jeff Becker Beer Industry Service Award to Jim Ryan, the now-retired SVP of corporate affairs for Constellation Brands. Ryan is a 35-year beer industry veteran.
- Maui Brewing’s Kokua Project, the cause beer collaboration effort to help the people affected by the Lahaina wildfires that have killed at least 97 people, is now up to 720 participating breweries, brewery founder Garrett Marrero shared.
- The BI, BA and NBWA will highlight the 90th anniversary of the repeal of Prohibition with an event.
- New members of the BI this year include Stone Brewing, Sapporo, Founders, Big Country Organic Brewing Co, Denver Beer Co., Epic Brewing, Duvel Moortgat, Daredevil Brewing, Pabst and Prairie Malt.