Global beverage company, Lion, says a drop in discretionary spending, the shrinking beer market, and increasing costs forced its closure of the Malt Shovel Brewery in inner Sydney. Malt Shovel Brewery operated for 36 years, it was founded by brewer Chuck Hahn in 1988 and acquired by Lion in 1993.
Beers produced at the Malt Shovel Brewery include James Squire, Eumundi, New Belgium, and Little Creatures.
Lion said production would be relocated to the Stone & Wood brewery in Murwillumbah on the far north coast of New South Wales and the Little Creatures Brewery in Geelong, Victoria.
Lion MD, James Brindley, told The Australian Financial Review that overall beer volumes had declined by 100 million litres since 2019.
Roy Morgan’s latest Alcohol Consumption Report found less than a third of Australians (6.7 million, 32.7 per cent) now consumer beer – down from 7.4 million (37.6 per cent) in the 12 months to March 2020.
“There have also been ongoing cost-of-living pressures reducing discretionary spending, and continuing increases in costs like energy, labour and ingredients, as well as government excise, which is now the third highest in the world,” Brindley said.
The craft brewing industry has been grappling with the same challenges, with more than 12 breweries going into voluntary administration in the last year.
Lion’s announcement comes after Asahi Beverages announced in May it would be closing the Matilda Bay Brewpub in Healesville in Victoria’s Yarra Valley, due to high costs, after only operating for five years.
Matilda Bay was part of Asahi Beverages’ craft business arm, Fire & Earth Ventures. Its GM, Ryan Saundry, said the brewpub no longer made sense logistically for the company.
“While we have seen some success with innovation from Matilda Bay over recent years, we have taken the difficult decision to close the Healesville brewpub and cease manufacturing operations there.
“Most of Matilda Bay’s brewing will be transferred to Asahi Beverages’ other Fire & Earth Ventures sites across Australia, including Pirate Life in Port Adelaide. These other sites have the capability to manage Matilda Bay’s continued growth,” Saundry said.
