Alcohol Producers in Texas Must Unite for Their Right to Produce

Alcohol Producers in Texas Must Unite for Their Right to Produce
May 25, 2011
by Michelle Minton/OpenMarket.org

As discussed in my latest “Alcohol Regulation Roundup” post, a representative for brewing giant, Anheuser-Busch (AB-InBev) testified at a Lone Star State Senate committee hearing last week to express the company’s opposition to what’s known as the “Craft Beer Bill.” HB 602 would deregulate a sector of the Texas beer market by allowing small brewers to sell a limited amount of beer to customers who visit the brewery. The reason for AB-Inbev’s opposition is that the bill excludes brewers in the state who producer more than 75,000 barrels of beer annually; in 2008, Anheuser Busch produced more than 100 million barrels of beer throughout its 12 breweries in North America. When Anheuser-Busch’s Houston, Texas, location opened in 1966, it had the capacity to brew 900,000 barrels of beer a year. However, as consumption in the US rose, the Houston facility expanded production and by 1982 was producing 3.5 million barrels a year. In 1994, the Houston plant alone employed more than 1,000 people.

As noted here by Texas Watchdog writer Mark Lisheron, it might seem strange that Anheuser would take the time and energy to fight a bill that (even if it did apply to large brewers) would not affect their bottom line in any significant way. It seems strange, that is, until you learn that the wholesalers have once again been pulling strings behind the scenes.

“Small brewers were encouraged to add a brewery output stipulation to the bill by the Wholesale Beer Distributors of Texas. Ostensibly, as Keith Strama, an attorney for the suds lobby, told the committee, “The bill was designed to promote local breweries as they gain market share.”

InBev had supported the bill in its earlier form until they realized that a provision added to the bill would limit participation to small brewers only. This sort of discriminatory treatment is an issue that Anheuser-Busch has made a point to address.