Business & Tech
    Next Score View the next score

    More lenient state laws could mean beer makers cut off low-alcohol brands

    “We just don’t see any need to continue manufacturing those beers.’’ said Sean Mossman of COOP Ale Works.
    Sue Ogrocki/Associated press
    “We just don’t see any need to continue manufacturing those beers.’’ said Sean Mossman of COOP Ale Works.

    OKLAHOMA CITY — Beer snobs are raising their mugs to a stronger brew in three states that once forbade grocers from selling anything but low-alcohol brands, and the changes could indirectly chill the industry in two others where such regulations remain.

    Until October, Oklahoma grocery and convenience stores could stock beer with only up to 3.2 percent alcohol content — considerably lower than even leading light beer brands. Liquor stores were able to sell stronger 8.99 percent beer but were prohibited from selling cold beer of any strength.

    Voter-approved changes now allow stronger ales to be sold in Oklahoma grocery and convenience stores. And many of the changes are being adopted in Colorado and Kansas.

    Advertisement

    The beer revolution will leave just two states — Utah and Minnesota — where only 3.2 percent beer may be sold in grocery and convenience stores. Beer industry observers say how lawmakers in those states react to the changes could determine whether the future of low-point beer in the US is as flat as a week-old lager. Half of the nation’s 3.2 beer market was in Oklahoma and an additional 20 percent was in Colorado.

    Get Talking Points in your inbox:
    An afternoon recap of the day’s most important business news, delivered weekdays.
    Thank you for signing up! Sign up for more newsletters here

    ‘‘It is a dramatic drop,’’ said Brett Robinson, president of Beer Distributors of Oklahoma, which represents some beer distributors in the state.

    Oklahoma was the first of the nation’s five 3.2-beer states to make the switch. That’s ironic considering alcohol was illegal until voters repealed statewide prohibition in 1959 — 26 years after Prohibition was repealed nationally.

    ‘‘It was a long time coming,’’ said Lisette Barnes, president of the Oklahoma Beer Alliance, a beer industry trade association. ‘‘ It’s been a good thing for both industry and consumers.’’

    As the market for ‘‘baby beer’’ continues to shrink, brewers must decide whether it’s profitable to continue to make it.

    Advertisement

    Anheuser-Busch, the world’s largest beer producer, said it will work to meet the needs of consumers in 3.2 percent beer states even amid declining demand.

    ‘‘While we will continue to produce 3.2 percent beer, regulatory and legislative changes in Oklahoma, Colorado, and Kansas that affect demand for 3.2 percent beer will impact our national production,’’ the company said in December.

    But some brewers are already cutting back on their 3.2 percent beer production. Oklahoma City-based craft brewer COOP Ale Works, which distributes in six states, including Oklahoma and Kansas, has discontinued two of its three 3.2 percent brews.

    ‘‘The only reason we produced those other two beers was to have beer in grocery and convenience stores,’’ said Sean Mossman, director of sales and marketing for COOP. ‘‘Now that we can sell our more popular styles in the grocery stores, we just don’t see any need to continue manufacturing those beers.’’

    And selling COOP’s flagship beers in grocery stores ‘‘has been a boon for us,’’ Mossman said. He said the brewer’s business has increased 50 percent since Oklahoma grocers began stocking its stronger beers. New regulations go into effect in Kansas in April, when grocery and convenience stores can start selling beer with an alcoholic content of 6 percent.

    Advertisement

    ‘‘Overall, we’re very happy about the death of 3.2 beer,’’ he said.

    Dwindling supplies of low-point brew is something state regulators have considered.

    ‘‘That’s the question we’ve been facing for a couple of years,’’ said Terry Wood, director of communications for Utah’s Department of Alcoholic Beverage Control. ‘‘Business decisions may be made that make it just a financial choice for the breweries to stop producing 3.2 beer.’’