2019 WA Beer Economic Report
Executive Summary
Washington beer production has surged in recent years, growing from just 283,400 barrels in 2005 to 582,400 in 2017. Washington is home to the largest single source of hop production in the world, with 75% of all U.S. hop production. Beer production volumes declined slightly from a recent peak of 632,300 in 2016, due to corporate acquisition of Washington beer and production relocation out of state, but growth in new craft brewers demonstrates industry strength and consumer demand.
Washington’s craft beer industry reflects both national trends and the state’s own qualities. Craft brewing has been on the rise across the U.S. In 2017, while overall beer sales by volume declined 1.2%, to 196 million barrels (BBLs), sales of craft beer continued to grow at 5.0%, reaching 12.7% of the total U.S. beer market (24 million barrels or 48 million kegs). Craft breweries contribute meaningfully to other parts of the economy through supply chain purchases and worker income. According to the Brewers Association, in 2017 the craft brewing industry nationwide contributed $76.2 billion to the U.S. economy and supported more than 500,000 jobs.
Beginning in the 1980s with Redhook and Pyramid, Washington has long been a hub for high quality craft beer. This study provides an in-depth review and analysis of the beer industry in Washington, including growth trends, distribution and sales channels, economic contributions, and outlook and challenges.
Breweries, Production, and Industry Segmentation
In the autumn of 2018, Washington had 391 licensed active brewing operations. Between 2005 and 2017 (last full year of data), overall volume of net production (gross production adjusted to exclude inventory losses) increased at an annual rate of 7% per year. Excluding Redhook, which relocated its production to Oregon, production increased 16% per year.
Production amounts per brewery can help segment the industry. The majority of breweries are small, with two thirds of licensed active operations producing fewer than 500 barrels (or 1,000 kegs) in 2017. Slightly more than half of all net production came from the eight largest breweries in the state; more than a third of net production was by the