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America’s craft brewers grow at home and abroad

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A majority of Americans live within 10  miles of a craft brewery and much of the small-batch craft beer brewed in the U.S. is still consumed fairly near the place it was produced, but in recent years some craft brewers have been expanding their reach by exporting. Craft beer export volumes grew by 49% last year, to 282,526 barrels worth about $73 million, according to the Brewers Association, which launched an Export Development Program in 2004 that’s funded with annual grants from the Agriculture Department’s Market Access Program.

The rise in exports makes sense as brewers continue to grow and expand their followings, said Brewers Association Craft Beer Program Director Julia Herz. Small brewers now have a world-class reputation for their beer, she said, and many of those brewers have shown a growing interest in increasing their distribution to emerging markets.

The number of U.S. craft breweries, including brewpubs, microbreweries and regional craft breweries totaled 2,483 as of June 2013, up from 2,347 in 2012 and 1,970 in 2011, according to the Boulder, Colo.-based Brewers Association. Overall, craft beer volumes have been booking double-digit annual increases for the past few years, and last year volumes rose 18%, even as the overall beer market slipped 1.9%.

Off-premise sales at liquor stores and other retail outlets account for the majority of craft beer sales, but draft beer is still a significant component. For small, independent brewers that turn out 6 million barrels or less a year, about 30% of that is draft beer, compared to less than 10% for large traditional brewers.

Canada was the top export market for U.S. craft brewers last year, followed by the U.K., Sweden and Japan, said Bob Pease, chief operating officer for the association. Pease, who oversees the export program, was in Austria this week to meet with importers and distributors, to identify those that might turn out to be suitable trading partners for members looking to export.

Members interested in exporting can pay an annual fee of between $500 and $1,200, depending on their size, to join the program. When Pease returns from his trip, he’ll send out trade leads to those members with information about the importers he has vetted. The program currently has 88 members and it’s “growing substantially and quickly,” as brewers see the benefits of expanding to global markets, he said.

Gearing up to export craft beer isn’t as simple as making a few trips abroad, and brewers still have to do their homework to be successful in each new market, but the program’s preliminary work can get the ball rolling. “We can do a lot of the pre-homework,” Pease said.

In addition to the members’ fees, the program received $600,000 in USDA grant funding this year, which will be spread over several markets as Pease and others work to balance the need to maintain connections in fast-growing markets and make contacts in new ones.

Distributors in different countries may have different tastes when it comes to the kinds of craft beer they want to buy, he said, but the ones they’re looking for all have one key thing in common — like the craft brewers the association represents, they must value quality over quantity.

“We’re not looking to promote exporting blindly, we’re doing it in a targeted fashion,” he said.

While many American craft brewers are wary at the thought of sending their beers so far afield, others are growing increasingly interested. “American craft brewers may be skeptical, but the smart ones realize that at some point they’re going to need new markets to grow into. Some brewers are content to sell in one state or a five-state region, and that’s fine, and some have expanded to 20 states and are still looking to grow. Those are the ones looking to connect with international markets.”