Stainless steel tanks stand like shining beacons at Canal Park in Duluth, signaling continuing growth in the craft beer industry.
A few years ago, Duluth was unquestionably in the midst of a craft beer boom with new breweries popping up all over the place. The last five years have seen breweries founded along the North Shore in Knife River, Two Harbors and Grand Marais.
Having made their debuts, many of those breweries continued to expand in 2016, and industry executives say the future remains bright. Laura Mullen, co-owner at Bent Paddle Brewing Co. in Duluth, said the five-year-old “Surly Bill” continues to have a positive effect on expansion. The bill allowed small Minnesota breweries to sell beer to drink on their premises, opening the door for many more brewpubs to open.
“The Surly Bill really opened the floodgates to have a different model of selling craft beer.,” said Mullen, and she believes the flood is still on.
In 2012, there were only 36 craft breweries in the entire state; now there are more than 100.
“It’s a large bubble. Here in Duluth, we are still only an emerging craft beer market,” Mullen said. Comparing the handful of breweries in the area to the Portland, Ore., market, where are around 80 craft breweries, Mullen said there’s still plenty of room in which to grow.
Bent Paddle spent 2016 settling into their growth, going from just two signature beers in 2012 to having four flagship brews, three seasonals and multiple ever-changing specialties. This past year, Mullen said, has been about stabilizing.
“We definitely hit our stride in 2015. Now we are getting creative,” she said. Count their double-shot double-black brew into that category. It is aged for 10 months in repurposed whiskey barrels and sold in limited bottles with a double-shot of espresso and vanilla added. The brew sells out very quickly.
Able to finally bring on the 250 accounts from their waiting list, for a current total of 1,200, Bent Paddle has been focused on catching up to their popularity. Adding a distribution contract in Superior and supplying retailers in five South Dakota counties has fulfilled part of their original growth plan.
“Now we want to concentrate on being a statewide artisan, and do that by continuing to provide a clean, consistent product,” Mullen said.
Clint MacFarlane, co-owner at Castle Danger Brewery in Two Harbors, also believes there’s plenty of room for growth.
“It’s been on everyone’s mind lately, but there’s always room for good beer in the market,” he said.
More than doubling their 2016 production from the previous year, the firm added staff and equipment at Castle Danger. Moving from a nano-brewery in their garage to the 2013 construction of a facility with four fermenter tanks, they now have 12 fermenters and continue to grow.
Calling this last year “incredibly busy,” MacFarlane said another expansion is planned for spring, with two more tanks and an 8,400-square-foot packaging facility to be added.
MacFarlane said they knew their business would grow, but they never expected the rapid rate.
“Craft beer is really the only beer segment that is growing. For us, it’s been manageable so far,” he noted.
Stepping out of the immediate Duluth-zone across the harbor to Superior, the Bev-Craft brewery consulting firm took off this year, adding to the layers of beer crafting economics by the addition of their “how to make a brewery” expertise. Company services include guidance on sales and marketing, brand creation, ingredients and recipe development. Headed by Tim Nelson, a heavyweight in the Twin Ports scene of craft brewing and co-founder of Fitger’s Brewhouse, the whole Bev-Craft crew is off the charts with experience in the genre. One of the fold, Dave Hoops, a former Fitger’s brewmaster, is stepping up his game even further. He intends to open a new brewpub in Duluth’s Canal Park. Hoops Brewing is planned to open in Spring, and Hoops plans to stay on at Bev-Craft in his lead consulting role.
Mullen said she easily sees room for Hoops Brewing, and more.
“They are a production brewpub model with only small distribution, where we are trying to grow throughout the region,” she said, adding, “Coop-etition is what we call it. We are competitors, but we share staff, exchange hops. It’s the best culture in the world for opening a business.”
Blacklist Brewery, around since 2012, has announced a move into a new taproom and manufacturing space on Superior Street in Duluth. Expecting an end-of-the-year grand opening, Blacklist has moved to a higher level with its fully remodeled taproom and distribution contract. “Because of the craft beer bubble, there’s lots of change, but it still comes down to brewing an artisan product for the masses,” Mullen said. While she sees plenty of room remaining for newcomers and market expansion, especially in the form of converting the 80 percent of typical commercial beer-drinkers to what she calls a better beverage (“Once you have craft beer you can never go back,”), she concedes a saturation point will be reached.
“Sure, the bubble will burst eventually, but those of us making high-quality craft beer will always rise to the top and survive,” she said.