FES: OMG

So when the word started to percolate about Guinness Foreign Extra Stout (I tweeted about that back on the 22nd, and I apologize for not blogging...gotta stop that), I got right back to the Diageo people and asked if it were true. Sure, they said, and would you like a sample? Yes!

This is a bit of a grail for me; I've kind of purposely kept myself away from it till I could get it legit. Worth the wait, and really not at all what I expected. First, it's not heavy and thick (like some other "Caribbean" stouts); it's actually quite light for 7.5%. Second, it has a great aroma of boozy burnt malt. Third, it's properly black...like I remember "regular" Guinness being, though that could be a trick of memory. Finally, it's not sweet! It's quite bitter, burnt bitter and hop-bitter, but smooth as a swoop. Intriguing stuff, and easy to understand why it's so popular: it's 45% of total Guinness sales!

What's not so easy to understand is why it's taken Diageo so long to bring it to the positively beer-crazy U.S. market. Was it because Guinness stout was so damned popular, they were afraid of cannibalizing it? Yeah, that strategy worked so well with Guinness Extra Stout...and Smithwick's... Should have sent this ten years ago!

Daura: that's Spanish for "Good news for celiacs"

I'm drinking my first sample of Daura, from Spanish brewer Grupo Damm, best known for their Estrella Damm, and the folks who released the beautifully-packaged (and surprisingly tasty, for all the scarily mainstream-brewer hype around it) Inedit last year. Daura is decidedly mainstream: it's straw-yellow, has a wispy white head that doesn't last overly long, it's fizzy. In its favor, it has the body of a Eurolager -- fuller than American light beer -- it has a distinct bitter tang on the end, and it's not overly fizzy.

So what's the big deal? Daura is gluten-free, or as near to it as to not matter (really: not my opinion, celiacs say so). Which means that this is easily the best gluten-free beer I've ever had: it tastes quite close to a normal lager, which is revolutionary.

It's not that surprising, though: Daura is made with malt, like a normal lager. Now, malt is low in gluten, but it's not gluten-free. How's that work? Here's the brief from importer United States Beverage:

Daura is a beer made with barley malt that is certified and guaranteed to contain gluten content below 6 PPM. This is a result of a proprietary brewing process that breaks down the gluten protein during the production process. Research and product development was made by Damm brewmasters in cooperation with the CSIC and Coeliac Association.

Deglutenized barley malt. Nice. Which definitely explains why it tastes like beer: it is beer, and not mead, or a sorghum beer, or a millet beer, some of the usual end-runs around gluten...which just don't taste like barley-malt beer. This does.

Mostly. There's just a tiny bit of astringency to it, which makes me think of Kaliber, the non-alcoholic beer. Back when I did a taste-test of NA beers, I got almost exactly the same reaction on Kaliber from everyone who drank it: tastes fine...until you have something else. Daura tastes different enough from something like Heineken or -- for instance -- Estrella Damm that it might taste funny if you switched away from it. But celiacs aren't going to be doing that! Besides, Daura tastes more like Eurolager than any of the NAs I've had, too.

Celiacs: your beer has arrived.

Affligem Noël

I'm drinking with an old friend tonight: Affligem Noël. I remember drinking Affligem a lot back in the early 1990s; it was a solid abbey-style beer, and the Noël was a seasonal I looked forward to each year. Then Heineken bought the brand, and distribution/import got iffsy-chancey. Affligem came and went, and it dropped off my radar.

Then a month ago I got an e-mail: Affligem Noël was available from a new importer, Total Beverage Solution (Mount Pleasant, SC). Would I like a sample? Hell yes, I would. (Interesting that it's not coming in through Heineken USA, which makes me wonder if it is still a Heineken brand; I'm working on that.)

So here I am, finishing up a beer that has just gotten better and better as it warms up. 9%, and my lips agree: this is a big boy beer. The nose is full of a pleasantly sweet-tart mix of pit fruit -- plum, sour cherry -- and a dark chocolate background. The beer itself matches that, with an intensely fizzy carbonation that is not unpleasant at all. What surprises me is the degree of attenuation; if you don't like Chimay Red/Blue for their sweet thickness, this is your beer. The Noël has a very light and drinkable body for that 9% ABV, and the fruit really cleans up the end.

Welcome back, Affligem. I guess I didn't realize how much I missed you until you came back.

New Heineken USA Chief; new strategy?

I get a lot of press releases and see a lot of stories about new people in positions at a variety of booze businesses, and most of them... eh, so what? This one was an exception, and not because it's a major company unit -- Heineken USA -- but because of the way the people formerly in the position were willing to say why they left, rather than simply "to pursue other opportunities." Check it out, then go back and re-read my post about imported beer. This is from the Wall Street Journal. (I've cut a bit from the piece; this is just the nuggets.)

Dutch beer giant Heineken NV tapped company insider Dolf van den Brink as the third chief executive in about three years to run its struggling U.S. division. Mr. van Den Brink, currently commercial director and deputy general manager for Heineken's operating company in the Democratic Republic of Congo, will become president and CEO of Heineken USA effective Thursday. He succeeds Don Blaustein, who resigned in August, citing differences with the company's management in Amsterdam about how to run the unit.
Mr. van Den Brink will try to revive U.S. sales of the company's flagship beer, Heineken, which have dropped sharply amid the weak economy, ineffective marketing campaigns and tough competition from rival imports and domestic brews. Mr. van Den Brink faces a tall order. In April, Heineken said its beer volume fell 16% in the Americas on an organic basis, which strips out results from recently acquired brands, in the first three months of 2009. Heineken USA accounts for about 4% of the U.S. beer market in terms of volume.
Mr. Blaustein's predecessor, Andy Thomas, also resigned because he disagreed with Heineken's top executives over strategy.

They tap the deputy from the Congo to run the U.S.? Wow.

I would love to know what the different outlooks on strategy are. Here's a suggestion on a US strategy: figure out what you're selling, then get Heineken ads that are as good as the "World's Most Interesting Man" Dos Equis ads are (which are actually working, by the way: Dos Equis is doing well). I like John Turturro, but good God..."No destination is the destination of the undestinated... This is not a beer. This is a compass."



What the hell is that shit? If you don't even know what your beer is -- here's a hint; it ain't a compass, you buy them at REI -- what are we supposed to get out of it? What's the most interesting man in the world say? "I don't always drink beer, but when I do, I prefer Dos Equis." Notice: he drinks beer, not a compass, and he admits that there are other drinks, and that he doesn't always drink Dos Equis. I think that's the best part of the commercial.

I'd also point out to craft beer fellow travelers that even after losing that volume, Heineken USA, by itself, does the same volume as all craft beers put together. Food for thought, mobsters.

U.S. drinkers continue to walk away from import beers

Reported in Beer Business Daily on Friday:

Things just don't seem to be getting any better for our imported beer shipments. Beer Institute released figures yesterday indicating that imported beer shipments were down another 8.1% in July, bringing year-to-date import shipments down 9.3%, or a loss of about 160,000 case equivs a day. There was some hope among import suppliers that sales would start to rebound toward the end of summer, but that just hasn't happened. In fact, anecdotally, distributors are telling us that the big imports are continuing to show steep declines in many big markets.
Losses are across the board: Mexican imports were down 4.7% in July, and YTD down nearly 3%. Netherlands down 14% year-to-date, while Canadian shipments off 22%, German shipments down 10%, Italy down 3%, and Belgian shipments off 11%. [Not Stella, BTW: Stella claims its U.S. sales are up 14%. -- Lew]

What's this mean? Well, imports -- which are almost all light lagers -- are pricier than comparable domestic beers because of shipping and the weak dollar. Craft beer's increases are thought to be coming largely out of imports' lost sales.

And, as former Capital Brewing prez Tom Fuchs told me in an interview back some years ago, "One of these days, the American import drinker is going to realize he's been sold a mule in racing silks." The big-selling imported lagers aren't bad beers, not compared to similar American light lagers. But they aren't better, either; in fact, they're not even significantly different (with the exception of Heineken, which is, these days, all-malt. Actually, so is Michelob, so never mind).

When money's tight -- mentally, even if there's no difference in your particular wallet, everyone is thinking tight -- you look at the relative value and think, why am I paying more for this? And, increasingly, people aren't, apparently. If this keeps up, it will represent a major shift in American beer-buying, one which will not be easily reversed. It also represents a major opportunity for craft beer, which is, of course, significantly different from mainstream light lagers.

Exchange rates: closing a door, or opening a window?

"When the Lord closes a door, somewhere he opens a window."

It's a quote from The Sound of Music, where the Mother Superior of Maria's convent is telling her that there are many ways to serve God, so when one path is closed, it doesn't mean you can't continue on your journey. I thought about that on Friday when I was talking to a booze analyst about the imported beer market. It's for a story I'm doing for Cheers, so I won't get into the numbers, but I don't think it's a surprise to anyone that exchange rates are hiking the U.S. price of most imported beers.

Along with the well-publicized rise in the price of hops and malt -- which is pretty much world-wide -- lower values of the dollar vs. the Euro and other currencies mean that beers from Europe, Asia, and yes, Canada, cost more than they did a year ago (wonder if that's affected the price of Blue Moon, which MolsonCoors is currently brewing in Canada?). If you want to buy a fine Belgian ale, a crisp Bavarian lager, or a big bottle of Unibroue, the price curve on your decision will be steeper. From Heineken to Salvator to Rochefort 8, import beers are bound to take a hit in sales, particularly with all the election year scare-talk about a U.S. recession (Congress and Bush are talking about a "stimulus package" before we've even seen any evidence of a recession -- not that either party is pandering or anything).

But if that door to brewed Heaven is closing, surely a window is opening for craft brewers and the Big Three (maybe even Pabst and the remaining regionals). Increased costs in hops and malt may mean price increases -- okay, it does mean price increases, and we're seeing them already -- but the foreign brewers have to add that increase on top of the exchange rate premium. American beer becomes more competitive, more attractive.

We're already seeing that in the majors: mainstream premium beers like Budweiser, Coors Banquet, and Miller High Life are all up, the first major uptick for them in years. People are starting to look at the price of a sixer of import lager, and of a sixer of Bud (and maybe thinking about the latest ads from Miller and A-B, which are hitting themes of solid value, 'regular guy' appeal, and even patriotism), and picking up the American beer.

Don't dismiss that factor in specialty beers. I expect to see more traffic in American-brewed versions of Euro-classics -- assuming American brewers continue to get better at brewing them -- and more experimentation with 'American' styles by both brewers and consumers, maybe backing off the extreme hops or at least moderating them. But I also think we're going to see even more solidification of flagship brands by craft brewers, as people 'hunker down' a bit to ride this out.

Make no mistake: the people who read this blog and the ones over there to the left, the people who read and post on BeerAdvocate, ratebeer, and Real Beer, you there, reading this right now, are probably going to be more likely to keep on spending to get what you want...but not all of you. And remember: craft beer is still under 4% of the total sales, and we the bloggers and readers, the folks who drink 400 different beers in a year, are just a tiny niche in that niche.

Look at the numbers. Most craft brew drinkers are drinking Sam Adams Boston Lager, Sierra Nevada Pale Ale, New Belgium Fat Tire Amber, Harpoon IPA (and Blue Moon Belgian White, if we're going to be honest and look at this in terms of "craft" styles). That's where the sales are that are getting us even close to 4%. I think things are going to shift even more towards those brands, because they'll have the steadiest prices and the most consistent product. Experimentation tends to go down when prices go up. Flagships will do well.

Which is probably a good thing. Those flagship brands will keep breweries alive till the hops and malt thing either sorts out or we get used to it. In the end, I think this is going to be a time of opportunity for American brewers large and small. It's a matter of reading the winds and the currents and deciding how to set your sails to catch the best breeze...while staying off the rocks and shoals.