Under newly announced trade restrictions, non-alcoholic beer produced in Canada will be prohibited from importing into the United States beginning September 29. That is a real disruption for a young category that has leaned on cross-border and contract production to get bottles on shelves. Switchback Brewing Co. in Vermont got ahead of it, installing a BrewVo dealcoholization system to bring its non-alcoholic beer fully in-house, with its last contract load from Canada arriving just before the border closed. Switchback is now the only brewery in Vermont producing non-alcoholic beer onsite, and it will serve as an East Coast production hub for other brands that want to make it.
The ground game is moving in the same direction. In New Hampshire, state liquor stores report sharp growth in non-alcoholic sales and local businesses are expanding their alcohol-free offerings, and new alcohol-forward-optional venues keep opening, including Lantern, which just launched in Yorktown, Virginia with an elevated food menu and a fully non-alcoholic bar program.
The Cr(af)ted Take
Import bans and dealcoholization equipment are not glamorous, but this is exactly what it looks like when a category grows up. Early on, alcohol-free beer could be made anywhere and shipped in, because volumes were small and nobody had built dedicated capacity. A trade rule that suddenly makes country of origin matter is the kind of problem you only have once the category is big enough to regulate, and the brewers who invested in their own production are the ones who get to keep serving customers through it.
It also complicates the tidy story that dedicated alcohol-free retail is simply struggling. Yes, some standalone shops have closed. But at the same time a brewery is onshoring production to meet demand, a state is reporting sharp retail growth, and a brand-new fully alcohol-free bar is opening its doors in Virginia. The picture is not decline, it is a shakeout: the businesses that treat alcohol-free as real infrastructure, not a novelty, are the ones building to last.
Original reporting: Vermont Business Magazine →