Beer distributors are holding a neutral outlook for the industry as a whole, but the craft beer segment is facing ongoing struggles, according to the National Beer Wholesalers Association’s (NBWA) Beer Purchasers’ Index (BPI) for November 2024. The latest BPI data reveals a sharp contraction in craft beer sales, marking the second-lowest index reading (18) since the BPI’s inception. The only lower reading occurred in April 2020 when the index hit 14 due to the early impacts of the COVID-19 pandemic.
The BPI, a key forward-looking indicator, helps distributors assess expected beer demand. A reading of 50 signifies a balanced market, while any figure below 50 indicates contraction. November’s overall BPI reading of 50 represents an eight-point increase from October 2024’s 42, and is in line with the same month last year (November 2023), which posted a reading of 51.
Despite the stable overall outlook, the sector remains divided, with some categories showing growth while others, particularly craft beer, continue to decline. The current market conditions are reflected in what is known as a “bullseye” outcome, where the index for at-risk inventory (49) and the BPI (50) align closely, signaling neither an optimistic nor a pessimistic forecast for the remainder of the year.
Segment Breakdown:
Imports: The import beer segment continues to show expansion, with a November 2024 reading of 64. Although this is down from 69 in November 2023, the index still indicates positive growth in imported beer volumes.
Craft Beer: The craft beer segment posted a concerning reading of 18, signaling continued contraction. This is a steep drop from the previous year’s reading of 26, further underscoring the ongoing challenges for craft beer as consumer preferences shift.
Premium Lights: The premium light beer segment saw a decline, with its index dropping to 46 in November 2024, down seven points from last year’s reading of 53.
Premium Regular: Similarly, premium regular beers also faced a downturn, with the index falling to 41, a decrease of seven points from November 2023’s reading of 48.
Below Premium: In contrast, the below-premium beer segment is showing resilience, with a reading of 50, up 11 points from November 2023’s 39. This marks one of the few segments to see a notable improvement year-over-year.
FMB/Seltzers: The flavored malt beverages (FMB) and seltzer category also posted an uptick, with a November 2024 reading of 34, up from 25 a year earlier. This segment is one of three to show a positive year-over-year change.
Cider: Cider sales appear to be on the rise as well, with the cider index reaching 36 in November 2024, compared to 30 in November 2023. Like FMBs and seltzers, cider is one of the few segments to post stronger numbers this year.
As the year draws to a close, the beer industry faces a mixed picture. While certain segments, such as imports, below-premium beers, and flavored beverages, show growth, the craft beer category continues to contract. Distributors are closely monitoring these trends, which will likely influence their strategies heading into 2025.
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