Perfect timing for crafting an export strategy for beer

Back in January, I wrote about the effects the European Central Bank’s quantitative easing (QE) programme will have on beer. The Euro exchange rate has, for want of a better word, tanked. We’re on course for parity against the US dollar and sterling is strong and only getting stronger. This could bad news for imports of US and UK craft beer into the Eurozone but great news for Irish breweries exporting or looking to export.

Exports of Irish beers could be boosted further by positive indicators within the Eurozone. Consumer sentiment for March 2015 is at its highest levels since 2007. Confidence has been boosted by the QE programme combined with falling unemployment and low oil prices. What does this mean? Quite simply private consumption is expected to rise by 2% this year and 1.5% in 2016 (source: Capital Economics). People will socialise with confidence and in economic terms this could involve boosts to nondurable goods (e.g. off licences) and services (e.g. bars, restaurants etc). This would underpin economic recovery within the Eurozone but sadly it’s one that will not be felt equally across all countries/regions.

Global finance and trade

So Irish breweries can benefit from the weak Euro currency to export to the US, UK and further afield and they can take advantage of the recovering consumer demand in the Eurozone. Irish exports would not only match quality but they could also be competitive alongside US and UK products exported to these markets. The costs associated with small batch exports may be offset by the strong dollar and sterling.

It is timely then that two significant events took place last week that hopefully will result in Irish breweries delivering on their export potential. Bord Bia’s Marketplace International 2015 saw 150+ Irish food and drink companies having access to 400+ buyers from over 25 countries. They could showcase their offerings in a sort of speed-dating format (i.e. a series of 20 minute one-on-one meetings). It was great to see Brú Brewery, Jack Cody’s, Metalman, Rye River and Trouble Brewing involved. Franciscan Well was also there as Bord Bia promotes all food and beverage products produced in Ireland. By and large each of the breweries have limited exports to date (e.g. average 5% of total sales) with the exception of Rye River reporting 40% export sales.

The other event was IFE 2015, a biannual food and drink event held in London. It brings together approximately 27,000 buyers and suppliers of food & drink products and takes over the entire Excel Arena in London. I worked at this event in 2005 and the scale is simply staggering. Whilst there was no Irish brewery exhibiting this year, the event is extremely useful for networking in the trade and meeting potential buyers and distributors. It was great to see the likes of Cotton Ball in Cork making it over to the expo.

Breweries at Bord Bia's Marketplace 2015
Breweries at Bord Bia’s Marketplace 2015

Hopefully events such as these can help these breweries and the others in Ireland take advantage of the extremely favourable export conditions. Irish breweries should be confident that they can follow in the footsteps of Carlow, the Porterhouse, Eight Degrees, Rye River and White Hag in having a significant export strategy. They should also aim to build on one-off or limited exports if it’s in keeping with their own business strategies. Isn’t it great to see the likes of Kelly’s Mountain on sale in Russia?

Scale’s obviously going to be an issue but improved market access can help attract additional finance. They may need ongoing help from Government agencies and the sector could benefit from more hands-on support from Enterprise Ireland. If negotiations on the Trans-Atlantic Trade and Investment Partnership (TTIP) are concluded, Irish SMEs are expected to benefit most from the new EU-US trade deal. This is some time off however and while it would make it easier to do general business in the US, the peculiar post-prohibition regulatory regime will remain in place.

This is not to forget that the market is still growing at home and the weak Euro may have a positive knock-on effect on consumer demand for Irish produced beers over UK and US imports. So far their prices have been steady but for how long can Irish distributors keep them steady? It will be interesting to watch effect, if any, does the exchange rates have on Wetherspoons’ prices as well.

Britannia brews with a little bit of help from the Irish

For St. Patrick’s Day, one may think it’s unusual to turn to the book Brew Britannia by Jessica Boak and Ray Bailey. Yes, it covers the recent history of British beer industry and it’s a thoroughly engrossing read as well. However, the book’s subtitle is the “strange rebirth of British beer” and there are plenty of Irish connections throughout.

Many people would have heard of Campaign for Real Ale (CAMRA). This consumers’ movement has become a British institution in its own right. Few people may be aware that this organisation was conceived during a lad’s trip to Ireland back in March 1971. The idea for launching the “campaign” and early ideas for the acronym were discussed in and around St. James’ Gate. Eventually they settled on the Campaign for the Revitalisation of Ale. The inaugural meeting of CAMRA took place Kruger Kavanagh’s pub in Dunquin, Co. Kerry on 23 March 1971 “probably”. While the four holidaymakers were already concerned with the state of British beer, apparently Smithwick’s “offered a nightmarish vision of what might to come to pass back home”. Although apparently the lads were also concerned by the lack of Indian restaurants in Ireland at the time and it is possible that if the beer was better, they might have gone and founded the Campaign for Indian Restaurants instead.

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The revival of brewing in London has a significantly Irish tinge to it. People may be familiar with Evin O’Riordain who founded The Kernel Brewery and has been part of the revived interest in the more American-inspired offerings. However, the capital’s brewing revival can be traced back to Patrick Fitzpatrick, a son of Irish publicans who operated pubs in London and Dublin. In 1977, Fitzpatrick was to open Godson’s Brewery, with the name borrowed from his hop merchant. Perhaps it was canny business sense not to use a distinctly Irish name back in the late 1970s Britain. He made a point of brewing naturally and stating that he used no added sugar or adjuncts. By 1980, his beers were available in Amsterdam but “before long, everything that could go wrong for Fitzpatrick did”.

Evin O'Riordain's The Kernel Brewery in Bermondsey has become a mecca for fans
Evin O’Riordain’s The Kernel Brewery in Bermondsey has become a mecca for fans

There’s a great section on the “pioneering” Belfast-native Brendan Dobbin. Rejected for a Guinness job, the Heriot-Watt educated brewer gained experience at Ringwood Brewery before moving to the new Antrim-based start-up Hilden Brewery in 1982. He firmly holds the view that he was the first microbrewer in Britain and Ireland to make lager. After a short stint with Hilden, Dobbin headed off to the US to discover new beer styles. Arriving too late for a brewing job, he worked with Campbell’s soup of all places. Nevertheless, he developed a knowledge of west coast hops, particularly Cascade and was to take this to Britain when he moved back in 1985. First, working back at Ringwood and then to opening his own brewery and pub in Manchester. The West Coast Brewery was located in the King’s Arms Hotel in a fairly rough area that bordered the Moss Side.

By the time Dobbin had opened the pub and brewery, he had already been experimenting for years with new world hops from as far away as New Zealand. This was cutting-edge stuff. He also had a knack for making clones. His clone for Sierra Nevada Pale Ale won prizes and the silver it took at the 1989 Great British Beer Festival brought Dobbin’s work to the attention (for the wrong reasons) of Ken Grossman and his Chico-based company. Dobbin renamed his beer Yakima Grande Pale Ale. While noted for his use of new and innovative hop varieties, Dobbin was “scornful” of ‘hop heads’ because “hops aren’t the only flavour in beer…So, no hops aren’t everything”.

The ex-King's Arms source: Gazza Prescott  http://hopcraftbrewing.blogspot.ie/2013_10_01_archive.html
The ex-King’s Arms source: Gazza Prescott http://hopcraftbrewing.blogspot.ie/2013_10_01_archive.html

By 1995, Dobbin decided he had enough of running the brewery and operating the pub in pre-urban regeneration and a little to mad for ‘Madchester’. He shut the brewery down and then focused for a while on installing brew-kits for the Firkin chain of brewpubs. He also consulted in Ireland for Clare’s Biddy Early Brewery as well as brewpubs Messrs Maguires and the Porterhouse in Temple Bar. One slight omission in this book is the role that the Porterhouse played in the London beer scene. When it opened in Covent Garden back in 2000, it was only the second specialist beer pub after Mark Dorber’s phenomenal White Horse (learnt from the book that the pub had an unwelcome nickname, “The Sloany Pony”)in Parson’s Green. Dobbin can be found down in Bandon, Co Cork as a quasi-hermit/banana grower. He recently was involved in installing the kit into yet another brewpub, this time for the Cotton Ball in Mayfield in Cork.

Great British Menu judge Oliver Peyton, popularly known for having “his face permanently contorted into a look of disgust and boredom”, makes an interesting appearance in the book. Mayo-born and Sligo-schooled Peyton became a beer importer in Britain during the 1980s and even held the exclusive UK rights for Sapparo. Before becoming a restauranteur, he also operated a number of clubs around London.

Oliver Peyton in front of the fermenters at Mash, Great Portland Street, London (1999) Source: National Portrait Gallery
Oliver Peyton in front of the fermenters at Mash, Great Portland Street, London (1999) Source: National Portrait Gallery

In 1996 he opened Mash and Air in Manchester, a venture that combined two different dining experiences and a microbrewery. He hired Alistair Hook, who would go and found Meantime Brewery, as head brewer. Lunch menus while pricey had a brewery tour and beer tasting thrown-in. Apparently the high prices “alienated more traditional beer enthusiasts” as did the did the styles brewed. According to Peyton, they were “nothing like the kind of one-dimensional British beers there were then”. This gastro-brewery concept was once thought to have the potential to expand like Belgo (remember that?) but it stopped at two locations. The Manchester operation ceased trading in 2000 and while the Great Portland Street restaurant is still going, Peyton’s no longer involved and brewing halted in 2007. However, the book hints that we may not have seen the last of his involvement in the beer scene and he may make a return as part of his burgeoning culinary empire.

It would be hard to write a book about British brewing today without mentioning Fergus Fitzgerald from Limerick, who’s head brewer at Adnams. He pops up in the book during a section on the uneasy relationship between ‘real ale’ and ‘craft beer’. Adnams are long noted for real ale but have been taking on-board (they love their nautical references) some trends some may commonly associate with the ‘craft beer’ camp but they ignore the fact that breweries like Adnams were craft before craft. On their Innovation brand, he says: “Fair enough, it’s been ‘pimpled’ now, and has more horsepower, some shine new banners and has been fitted with a ‘banging’ sound system so you can hear it coming, but it’s still the same wagon”.

Limerick-native Fergus Fitzgerald is the Head Brewer of Adnams Source: Adnams
Limerick-native Fergus Fitzgerald is the Head Brewer of Adnams Source: Adnams

This book traces the revival of British beer from the early days of tie-wearing members of the Society for Preservation of Beers from the Wood to CAMRA to the rise of pubcos and Thatcher’s de-regulation of the pub industry. It takes in the faces and places of breweries started in the last forty years, including those counter-revolutionaries to real ale. At each step, there’s seems to be an Irish hand. There could be more as this book is peppered with names such as Sean Franklin, James Lynch, Roger McBride etc. It’s possible they have Irish roots too. Dave Bailey also gets a mention and he practically deserves a passport for the number of appearances he’s made at Irish festivals and Hardknott’s collaboration with Waterford’s Metalman Brewery.

Ultimately, it’s an enjoyable read and is written in a style that makes you feel part of the journey. It’s a skill that many history writers lack. You can also check out their musings on their blog: http://boakandbailey.com/