Sven Van Kerckhoven, Sean O’ Dubhghaill, and Carlota Gomez Jimenez (Brussels School of Governance)
For many centuries, the British beer market developed in quite a unique fashion. Typically, beer (ales) was brewed on the premises where it was sold, but this slowly changed with the arrival of guilds who improved both beer’s quality and availability. With brewing becoming both more organized and reliable, inns and taverns turned to early commercial breweries, rather than brewing themselves. This way, the British beer market came to be dominated by local and regional cask ales, which finished maturing in the cellar of the pub rather than at the brewer. The eighteenth century bore witness to the appearance of a few new typical British styles, like the porter. This beer was the first to be aged on the brewer’s premises, rather than at the publican’s premises, and was the first beer ready for immediate consumption when leaving the brewer, allowing for wide distribution and a scaling up of production. As a result, the overall industry became more and more concentrated but the focus on regional brews remained strong. The latter was ensured through pub ownership. Pubs, an integral part of British social and cultural life were often owned by regional and local breweries. In 1974, for example, 53% of all pubs were either owned by or rented from the six biggest British brewers at the time. These so-called tied houses are only allowed to carry the beer of the brewer who owns the premises or to whom they are affiliated, which in turn have ensured the longevity of regional and local brewers. However, these were slowly replaced by free houses, which benefited from the increased distribution of beer in glass bottles, generating greater variety in pubs’ offerings.
The moment the UK joined the European Economic Communities in 1973 marked a point of no return for the state of British markets and consumer trends. Lager, which already had a longstanding popularity in Europe and around the world, took the British beer market by storm in the 1970s. This resulted in an increase in the number of imported beers, bringing in different, long-established beer styles from around the world, which had previously been absent or in short supply in the UK. However, these new trends were not equally welcomed by everyone. The “Campaign for Real Ale (CAMRA)” was launched, a movement attempting to ensure the survival of typical British ales as a response to foreign beer styles flooding the market. They accomplished the revival of regional and local breweries that focused on cask ale, but CAMRA failed to reverse the ongoing trend toward international beers and lagers.
As non-UK styles gained in popularity over recent decades, the British beer market started to become more integrated with the EU and American beer markets. By default, it began to mimic other beer markets’ industrial organization, whereby a large part of the market came to be dominated by a few large foreign lager producers, who also used their market access to promote their ales. Additionally, due to consumers’ newfound appreciation for foreign styles, the British beer market quickly became a top priority for multinational brewers. Foreign-headquartered brewers took over several existing ale producers, increasing their presence in the UK. This resulted in only a few multinationals serving the majority of the market, and a huge dominance by EU based brewers of the UK market (90% of beer imported into the UK hails from the EU).
Brexit potentially could have provided the impetus for British brewers to reclaim a substantial part of the British beer market – in particular in combination with the surge in craft breweries in the UK, not only attracting British beer drinkers but also foreign consumers. However, the firm hold of foreign headquartered brewers increased rather than decreased. These brewers continued to acquire British breweries, including also the prospering British craft breweries who are being pursued actively by foreign producers. As a result the level of imports from the EU has further increased, while even more and more foreign brews are being produced on British soil, and the level of UK exports has fallen due to increased legal and transportation complexity after Brexit, hurting their competitiveness in foreign markets.
Moreover, there have been some additional issues encountered by brewers located in the UK concerning the sourcing of brewing ingredients. Brewers have complained about the difficulties involved in sourcing wheat, barley and hops due to the higher cost of importing these, the paperwork that comes with this process, and longer delivery times. Brexit affected craft brewers directly; most of the top 100 craft brewers in the UK used to send about 20% of their production abroad, something that has become increasingly difficult. Internal competition has risen, with the supply of highly hopped beers for UK consumers at an all-time high whose interest in these beers had previously been limited. This intensifying competition damages the prospects of many craft breweries’ ability to survive, while making some of them easy pickings for foreign-headquartered brewers.
As a result, foreign-headquartered multinationals dominate the British brewing industry, offering lagers, beers originating from other countries, as well as several British beers. The most popular beers in the UK are no longer owned by British brewers. Of the 139 most popular beers in the UK, only 30 are still owned by a British brewer, comprising about 22% of the total. Several beers, about 17% of the total, are owned by a Belgian brewer, and 12% by a Dutch brewer. Many of these foreign-headquartered brewers first entered the market with their lager beers, and then acquired British brewers. The British beer market is thus no longer British, with the notable exception of some regional brewers with strong links to the hospitality sector (and some craft brewers). These are close to becoming the last true British brewers.
Dr. Sven Van Kerckhoven is the Vice-Dean for Education and a Professor of Economics at the Brussels School of Governance, Vrije Universiteit Brussel. Dr. Sean O’ Dubhghaill is an Irish anthropologist and International Relations Professor at the Brussels School of Governance. Carlota Gomez Jimenez is an advanced undergraduate International Relations student at the Brussels School of Governance. This work is based on the following book chapter: Van Kerckhoven, S. and O’Dubhghaill, S. (2023). The last of the Britons? The impact of globalization and Brexit on the UK beer industry, in Patterson, M. and Hoast-Pullen, N. (eds.) The Geography of Beer: Policies, Perceptions, and Place. Springer, pp.45-58.
The views expressed in this blog post are the position of the author and not necessarily those of the Brexit Institute blog.