Deschutes Brewery again delays Virgina expansion

Deschutes Brewery (Dean Guernsey / The Bulletin file photo)

Neither slumping sales, nor competition from cannabis knocked Deschutes Brewery off its perch as the tenth-largest craft brewer in the country.

The 2018 ranking of the top 50 craft brewers by sales volume was released on Tuesday by the Brewers Association, a nonprofit, Colorado-based trade association. The seven biggest craft brewers were unchanged from 2017, according to the Brewers Association. Craft brewing is defined as making 6 million barrels of beer or less a year.

Since Deschutes Brewery began in 1988, the number of craft brewers nationwide has increased from 100 in 1988 to about 7,000 in 2018. That same growth was seen in Oregon, where the number of craft brewers jumped from 124 in 2011 to 266 in 2017, according to the Brewers Association.

“It’s extremely important to all of us here at Deschutes to be ranked among the top 10 craft breweries by the Brewers Association,” said Gary Fish, Deschutes Brewery founder. “There’s a lot of pride among myself and fellow co-workers in being an independent, family and employee-owned brewery in this incredible Bend community for over 30 years.”

Fish said that innovation is driving 2019 with the launch new brands, which should boost the bottom line. The brewery’s sales closed 2018 down 9.3 percent, and sales are up so far this year 0.5 percent in Oregon and 8.8 percent in Bend.

“Being one of the top ten in terms of sales shows a broad appeal for Deschutes beer and the overall Deschutes brand. You don’t reach that point in the rankings without doing a lot of things right,” said Bart Watson, Brewers Association chief economist.

“The other companies on the top 50 craft brewing company list face a similar competitive environment as Deschutes, so it’s not that surprising that we aren’t seeing too many dramatic rankings changes, particularly in the top 10,” Watson added.

In 2012, Deschutes Brewery was ranked No. 5, Watson said.

Deschutes distributes in 30 states, Washington, D.C. and Canada. Being ranked among the top 10 indicates that Deschutes Brewery is connecting with beer consumers, Watson said.

“There have been plenty of beer companies over the years that dropped out of this list entirely, so holding your spot is an accomplishment,” Watson said.

Cannabis not only competes with breweries for consumer dollars, but for workers and investment, Watson said.

A recent survey of cannabis users by Quinn Thomas, a Seattle- and Portland-based marketing firm, found 38 percent of all cannabis consumers report drinking less alcohol since cannabis was legalized for recreational use, and 58 percent said they drink about the same. The firm surveyed 900 people in Washington, Oregon and Colorado.

The iconic Bend brewer late last year laid off about 10 percent of its workforce and agreed to forgo tax incentives on a second brewery in Roanoke, Virginia.

The goal, the brewery said, was to gain freedom over the development timeline for its East Coast operation.

Construction was to begin this year and brewing to begin in 2021. The brewery has until mid-2020 to submit its plans.

In May, the Brewers Association will release figures on total craft beer production. Also ranking on the Brewers Association list hailing from Oregon were Ninkasi Brewing Co. in Eugene, Rogue Ales in Newport and Full Sail Brewing Co. in Hood River.

The Brewers Association also ranked breweries overall with Anheuser-Busch (Budweiser, 10 Barrel Brewing and Goose Island) as the largest, followed by MillerCoors, Heineken and Pabst Brewing.

Of the Oregon craft brewers that rank nationally, Deschutes Brewery sold the most beer in the state last year with 66,000 barrels. Ninkasi was third with more than 50,000 barrels, and Full Sail Brewing Co. in Hood River was seventh at 22,500 barrels, according to the most recent data released by the Oregon Liquor Control Commission.

— Reporter: 541-633-2117,

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