Kentucky’s craft brewing industry is growing, with statewide expansions, new brewery openings, and an overall growth rate of roughly 600 percent over the last five years.
The Kentucky Guild of Brewers projects that brewers, which number more than 40 statewide, will produce at least 40,000 more barrels of beer in 2017 than in 2016. Eleven new breweries opened last year, with more planned for this year, and several are expanding. This rise in the market for craft beer resulted in a 25 percent increase in brewery industry workforce and an estimated $495 million economic impact in the state in 2016.
“We expect the growth to continue for the foreseeable future,” says Derek Selznick, executive director of the Guild, noting that the national market share of craft beer far outdistances that within Kentucky’s borders, offering ample room for growth. “We are opening breweries this year across the state, and our breweries are investing in themselves to increase their production to keep up with demand.”
But this kind of demand-based growth is only part of the equation: Quality of the beers being produced is the focus of the Guild of Brewers and breweries in Louisville and across the Bluegrass. When so-called craft brewing was finding its way in the late 1990s and early 2000s, beer makers tended to brew basic styles.
But modern palates have led to creativity, which has created segments. Brewers are no longer as beholden to selling basic styles to make ends meet as Kentucky beer drinkers begin to line up for experimental beers ranging from barrel-aged to sour.
Asked to cite a primary goal of the Guild and Kentucky breweries in 2017, Selznick doesn’t answer with “growth.” Instead, he says, “In a word, quality. Across the board we are committed to making sure the beer we are putting out there is of the finest quality.”
He isn’t alone in this thinking. Great Flood Brewing Company, which operated for two years in a tiny Highlands taproom on a tiny system, recently opened a production brewery in the Shelby Park neighborhood, complete with a canning line and plans for a taproom, not to mention a quality control laboratory.
“I think we’ll begin to see quality and consistency become more heavily scrutinized as our craft beer drinkers become even more educated and experienced,” says Vince Cain, co-owner of Great Flood. “Breweries that put their customers first and don’t cut corners on quality will likely be rewarded with sustained growth and success.”
In Lexington, Country Boy Brewing and West Sixth Brewing are among those getting creative. Country Boy has invested heavily in its barreling and sour program, and that in part — along with quality and innovation from the get-go — has led them to opening a new, $5.6 million production facility and taproom, which enables the brewery to increase production capacity by 400 percent.
“For us,” says Daniel “DH” Harrison of Country Boy, “the future is in the sour program and doing it right.”
The brewery even has a dedicated person to oversee the program in co-owner and brewer Evan Coppage.
“The sour program, for me,” says Coppage, “is the biggest experiment ever.”
Meanwhile, West Sixth not only has utilized its space for brewing, but as space for other businesses as well, from a seafood restaurant to a hydroponic farm. The business is run with employee ownership, and it also operates as a good samaritan, donating an estimated $120,000 last year to Kentucky charities.
Louisville is following suit. Gravely Brewing Co., expected to open later this year, will include a music venue. Mile Wide Beer Co. has found a formula of success selling crowlers, while Monnik Beer Co. not only has a rep for its beer — including its eye-catching new IPA cans — but for its food.
Of course, Against the Grain Brewery & Smokehouse here in Louisville is a driver not only in growth — opening a $1.7 million production brewery in 2015 — but also in quality and creativity. Original artwork, inventive beer names, and a forward-thinking attitude has the beer being distributed all over the world.
In fact, co-owner Sam Cruz recently told me, during a packed-house event, that there’s really no place he or his fellow AtG owners can go on earth where they couldn’t have access to their own beer. That’s fairly remarkable after just five-plus years in operation.
Another creative grower is the relatively new 3rd Turn Brewing, which opened in Jeffersontown in 2015 and recently announced it would open a second brewery in Oldham County that also will include a community farm, beer garden, and other amenities. But 3rd Turn represents a slightly different kind of brewery, at least for now. Whereas Against the Grain, Country Boy and West Sixth continue ramping up production, 3rd Turn is a brewery that will, for now at least, exist to serve its communities.
“I like the sense of community local breweries provide,” says 3rd Turn co-owner Ben Shinkle, referring to the one-on-one interaction in a taproom. “I love being able to educate people. You can’t educate people with a six-pack on a shelf.”
Indeed, breweries like Old Louisville Brewery and the brand new Holsopple Brewing in Lyndon are tailor-made for their neighborhoods. The former does a few experimental beers, such as a peanut butter and jelly ale, but for now, owners Wade and Ken Mattingly are content to serve the neighborhood. Ditto for Sam and Kristy Gambill, who will open Holsopple next week.
Lexington’s Ethereal Brewing Co. is one that is grabbing attention with its beers, and recently added another 30-barrel tank. This small brewery in an out-of-the-way neighborhood also has a yeast lab from which it springs many interesting brews, many of them Belgian-inspired. But so far, it’s been content mostly serving the Lexington area.
“We never had the idea to be a big brewery,” says co-owner Brandon Floan. “We always wanted to stay small. We don’t picture ourselves even pushing past the border cities that exist outside of Lexington — it’s not a battle we plan to spend any time on.”
The “battle” he refers to is the limited number of tap handles and limited amount of retail shelf space. With much of this being dictated by distributors, it’s difficult for smaller breweries to fight their way through. This is part of why many won’t bother investing in retail distribution.
“I think our biggest challenge is an increase in competition from the sheer number of breweries that are producing cans and bottles,” Selznick says. “That said, we have a hometown advantage as consumers are focusing more and more on supporting local breweries.”
“We are all fighting for market share, shelf space and staying in touch with the ever-changing desires of our customers,” adds Cain. “I don’t think these are issues unique to our state, but many of our breweries are very young and still establishing themselves — Great Flood included — so we’re still making ‘first impressions’ with customers every day.”
Selznick hopes education begins in the taproom, with educated bartenders and at beer festivals such as the forthcoming Tailspin Ale Fest on Feb. 18. He also says he plans to increase social media presence and promotion, along with email communications.
Still, he sees the growth continuing for Kentucky breweries, be they of the large variety, or the small neighborhood type.
“We have a long way to go before we even start to hit our cap as far as market share is concerned for bottle and can sales, and we are focused on our state,” he says. “We still have cities, such as Owensboro, that don’t even have a brewery yet. Regardless of the breweries’ approach to sales, the future of craft beer is very bright.”