Keg-tastrophe: $1 Billion In Beer Going Bad

By Neat Pour Staff |

Throughout the COVID-19 pandemic, Nielsen reported record highs for off-premisses beer sales. However, on-premisses, the market went stale—literally. With bars and large venues closed, hundreds of millions of dollars worth of beer is sitting in kegs and slowly going bad.

In March, Neat Pour reported on a ‘Save The Beer,’ a campaign to sell about 5.4 million beers wasting away in 141 of the Czech Republic’s breweries.

Mirroring the virus’ spread, the beer glut did not reach the US until about a month later. However, when it hit here, it hit hard. Lockdowns coincided with St. Patrick’s Day and the NCAA’s March Madness tournament, two of the biggest draft beer events of the year. The perfect storm could result in over one billion dollars in expired beer according to the National Beer Wholesalers Association (NBWA).

“This was the absolute worst time for this to happen for draft beer,” NBWA CEO Craig Purser told the Wall Street Journal. “We have never ever seen an interruption like this where everything freezes in place.”

Editor’s Note: Keg beer, stored properly, typically goes bad in two to four months.

Not only are venues facing massive financial losses from the unsold suds, but they are also facing a second problem of disposal. Apparently, you can’t just dump massive volumes of beer down the drain. Doing so carries numerous environmental risks to water supplies including altering the pH balancer reduced oxygen levels, and harmful bacterial growth.

And, then there’s the logistics of the actual return. Removing kegs from locked and unstaffed venues—including stadia—requires some serious planning. Plus, distributors are not prepared to handle such a large-scale return of full kegs. New routes are required; trucks will have to be increased and then loaded differently to account for the much heavier full kegs; extra storage will be needed; and so on, and so on.

The majority of the kegs will need to be drained into holding tanks where they will be treated with chemicals to render those threats moot and then work with municipalities to coordinate to release into a final processing plant.

There is some measure of relief planned for distributors. Several brewers including Big Beer standard bearers AB InBev and Constellation Brands announced plans to subsidize the losses shouldered by brewers.

Some companies are taking more creative approaches. Rye darling WhistlePig is receiving 6500 gallons of expired beer daily from neighboring breweries. WP told Bloomberg that they are repurposing the brews into distillates.

Boston Brewing Company, Sam Adams’ parent, has a preexisting ethanol program which they are currently ramping up. And, of course, plenty of hand sanitizer projects are in the works.

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