02-05-2025
Arizona craft brewers struggled to bounce back after COVID-19 pandemic
The craft brewing market is trending in the wrong direction.
Why it matters: The once-thriving industry struggled to stay afloat in 2024 after posting its third consecutive year with negative growth, a trend driven by market saturation and shifts in alcohol consumption, particularly among younger drinkers.
Zoom in: Arizona Craft Brewers Guild executive director Andrew Bauman told Axios the industry has been battling a barrage of external market forces since the COVID-19 pandemic.
Some breweries had to take out loans during the pandemic to stay afloat. Now, they're stuck making payments while dealing with inflated prices on everything from barley to hops, he said.
Meanwhile, the hospitality industry has not completely recovered from the pandemic, with many bars and restaurants still operating at reduced hours (closing at midnight instead of 2am, not opening for lunch, etc.).
By the numbers: Nationwide, craft beer production hit 23.1 million barrels in 2024 — a 4% decline compared to the previous year and the largest drop in industry history outside the pandemic, according to data released last week by the Brewers Association.
The number of small, independent breweries operating in the U.S. decreased for the first time in 20 years with 501 closures compared to 434 openings.
What we're watching: The economic headwinds are expected to continue with tariffs (or the threat), which could raise prices on aluminum and steel used for cans and brewing equipment, Bauman said.
