Breweries face beer woes as product goes bad, industry hesitantly reopens due to COVID-19 pandemic

AUSTIN, Texas -- Beer has been sitting around in kegs for weeks. For many small, local breweries, that means beer sales have tanked except for to-go and six-pack purchases, leaving the beer to go bad.

"If this keeps going, we're going to end up with a lot of product we're going to end up dumping," said Ben Sabel, the founder of Circle Brewing.

Despite some states, like Texas, who began reopening businesses and dining rooms Friday, it might not be enough for some breweries because bars can't open yet, reported KEUV.

"Restaurants do a tremendous amount of business for us, but a lot of the beer we move is through bars. People drink a lot of beer at bars," Sabel said.

"Over 16,000 taps have been lying dormant," said Sean Erney from Brown Distributing.

Erney moves beer in seven counties across Texas.

Because of COVID-19, they've had to buy beer back.

"We repurchased over 2,000 kegs and 7,000 cases and we made sure the beer is going to be fresh for this phase 1 of the governor's plan," Erney said.

At a distribution level, deliveries to stores have balanced out the deliveries to bars and restaurants, but on the local level for places like Circle Brewing, there's a lot of beer just sitting around.

"If it's already in a keg, we can't necessarily go backwards and package it off and put it in six packs anyway. So whatever is already in kegs is probably going to be dumped," Sabel said.

It's this time of year that Sabel said he normally sees 40% of the brewery's business.

"We generally have a month to two months of inventory on hand," he said.

Most of that inventory is now getting canned.

While he said it helps, it's not the same as draught beer out of a keg.

As restaurants start to reopen their dining rooms, many are taking it slow, according to Erney.

"If they have 20 taps, they're keeping it to 10. If they have traditionally 50 or 100 taps, they're kind of looking at that halfway point," he explained.

This is making breweries like Circle feel the pinch.

"The overwhelming majority of our business is selling draught beer to bars and restaurants, so that's completely stopped. We can't do any of that," Sabel said.