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Craft Brews Slowly Chipping Away At Big Beer’s Dominance


March 17, 2013 6:14 PM
Craft beers are offered for sale at Sam's Wines and Spirits in Chicago. Craft beer has about a 6 percent market share in the U.S. beer market, which is dominated by Anheuser-Busch InBev and MillerCoors.

Craft beers are offered for sale at Sam’s Wines and Spirits in Chicago. Craft beer has about a 6 percent market share in the U.S. beer market, which is dominated by Anheuser-Busch InBev and MillerCoors.

Scott Olson/Getty Images


“America loves beer.

In the U.S., we drink $200 billion worth of the hops-brewed libation annually. What many Americans might not know is that most domestic beer, 90 percent in fact, is dominated by just two companies: Anheuser-Busch InBev and MillerCoors.

Innovators, however, are challenging that dominance in the form of craft beer breweries. Small “mom and pop”-style breweries — or regional breweries — now account for about 6 percent of domestic beer sales. That may seem like a small number, but it’s been growing every year since the early 1990s, while big brewers’ share is declining.

There are now more small breweries than there were before Prohibition, when beer was largely a regional business.

Why Craft Beer?

At Meridian Pint, a trendy D.C. bar and restaurant, you wouldn’t even be able to order a Budweiser, Coors or something else from the big two.

“I try to have a nice mix of approachable craft beers, as well as exciting new stuff for people who have tried a lot of everyday beers,” says Sam Fitz, the beer director for Meridian Pint. He’s a cicerone, which is like a sommelier for beer.

Meridian Pint offers brands such as DC Brau, Flying Dog and Oxbow. Fitz says he prides himself on this kind of handpicked selection, but there are some brands he won’t carry.

“I do not carry any beer that comes under the Miller or Coors or Bud labels,” he says.

That’s just fine with his customers, like Landon Rordam, who says he isn’t looking for those big names but instead tries to find something he hasn’t tried before.

Big Beer Vs. Craft Beer

Consolidation of the big brewers also worries the Justice Department, which recently blocked an attempt by Anheuser-Busch InBev to buy the 50 percent of Grupo Modelo it does not already own. The Mexican beer maker, the world’s third-largest, owns Corona, Negra Modelo and other brands.

Journalist Elizabeth Flock, who reported on the blocked merger and the beer market for U.S. News and World Report, says the Justice Department said AB-InBev, by buying Grupo Modelo, would effectively eliminate its competition.

The problem for craft brewers, Flock tells Jacki Lyden, host of weekends on All Things Considered, is that those sorts of mergers make the fight against big beer companies even more difficult.

“Everyone wants to be on grocery store shelves at eye level,” Flock says. “Craft brewers say big beer is increasingly pushing them out of those prime spots.”

There’s also the issue, Flock says, of what the Brewer’s Association calls “crafty” beers — beers owned by big beer companies disguised as small craft beer. A common example is Blue Moon, a Belgian-style beer.

“A lot of people think that [Blue Moon] is a craft beer, but it is in fact owned by MillerCoors,” she says.

Craft brewers argue that this limits consumer choice, Flock says. For instance, if a bar stocks the top brands from a big brewer along with these “crafty” beers, consumers are essentially only buying from a single company.

Not everyone agrees. Benj Steinman, an editor for Beer Marketer’s Insights, a trade publication, says these so-called “crafty beers” might be helping the craft beer market.

“What Anheuser-Busch and Coors have done through Shock Top and Blue Moon is opened up a greater number of consumers to the universe of craft beers and their innovation, flavor and variety,” says Steinman, a 30-year veteran of the beer business. “They’re sort of gateway beers.”

In other words, they are more accessible craft beers that might get you started wanting to taste other, more complex beers with notes of dark cherry or sassafras molasses.

Julia Herz, the craft beer program director for the Brewer’s Association, says big beer should print its names on the bottles.

“What we’ve called for is a transparency of parent company ownership, and to put that on the beer label so the beer-lover has a chance to know who’s behind those brands,” she says.

Herz says branding matters to many beer drinkers, especially those who care about the brands they consume and who owns those companies.

“A lot of millenials are associating themselves with what they consume and what they hold in their hand,” she says.

The Question Of Cost

Craft beers are, without question, more expensive, which might make it harder for them to compete against the bigger brands.

“This is a very middle-class beverage, [a] working-class beverage,” says Chris Thorne, a spokesman for the Beer Institute, the largest beer industry trade group. “So what a lot of people are looking for is what’s affordable.”

Thorne says fierce competition is nothing new in the beer business: It’s been that way since the days of Fred Miller, Freddy Heineken, Adolph Coors and August Busch.

“These are names that are rooted in our heritage, in the beer-drinking culture in the U.S., and they never got a break,” Thorne says. “They competed with each other.”

Back at Meridian Pint, beer director Fitz shows off his 24 beer taps, all pouring high-end craft brews. He really doesn’t want to lose that market share to beers pretending to be microbrews.

“It certainly is more expensive, but for what we’re trying to do, we’re trying to offer the highest-quality products that we can,” he says, “and that means buying from producers that use good ingredients and are innovative producers.”

In the bar, customer Rordam says even if he has sampled some upscale microbrews at $6, $7 or $8 a pint, those prices might eventually force him to go back down the ladder.

“After I’ve had like three or four microbrews, I’ll think, ‘Wow, that was $25 [or] $30, I should probably get a Bud Light now because this is getting ridiculous,’ ” he says.”

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by | March 18, 2013 · 4:17 pm

How Beer Gave Us Civilization

Anders Nilsen


Published: March 15, 2013


“HUMAN beings are social animals. But just as important, we are socially constrained as well.

We can probably thank the latter trait for keeping our fledgling species alive at the dawn of man. Five core social instincts, I haveargued, gave structure and strength to our primeval herds. They kept us safely codependent with our fellow clan members, assigned us a rank in the pecking order, made sure we all did our chores, discouraged us from offending others, and removed us from this social coil when we became a drag on shared resources.

Thus could our ancient forebears cooperate, prosper, multiply — and pass along their DNA to later generations.

But then, these same lifesaving social instincts didn’t readily lend themselves to exploration, artistic expression, romance, inventiveness and experimentation — the other human drives that make for a vibrant civilization.

To free up those, we needed something that would suppress the rigid social codes that kept our clans safe and alive. We needed something that, on occasion, would let us break free from our biological herd imperative — or at least let us suppress our angst when we did.

We needed beer.

Luckily, from time to time, our ancestors, like other animals, would run across fermented fruit or grain and sample it. How this accidental discovery evolved into the first keg party, of course, is still unknown. But evolve it did, perhaps as early as 10,000 years ago.

Current theory has it that grain was first domesticated for food. But since the 1950s, many scholars have found circumstantial evidence that supports the idea that some early humans grew and stored grain for beer, even before they cultivated it for bread.

Brian Hayden and colleagues at Simon Fraser University in Canada provide new support for this theory in an article published this month (and online last year) in the Journal of Archeological Method and Theory. Examining potential beer-brewing tools in archaeological remains from the Natufian culture in the Eastern Mediterranean, the team concludes that “brewing of beer was an important aspect of feasting and society in the Late Epipaleolithic” era.

Anthropological studies in Mexico suggest a similar conclusion: there, the ancestral grass of modern maize, teosinte, was well suited for making beer — but was much less so for making corn flour for bread or tortillas. It took generations for Mexican farmers todomesticate this grass into maize, which then became a staple of the local diet.

Once the effects of these early brews were discovered, the value of beer (as well as wine and other fermented potions) must have become immediately apparent. With the help of the new psychopharmacological brew, humans could quell the angst of defying those herd instincts. Conversations around the campfire, no doubt, took on a new dimension: the painfully shy, their angst suddenly quelled, could now speak their minds.

But the alcohol would have had more far-ranging effects, too, reducing the strong herd instincts to maintain a rigid social structure. In time, humans became more expansive in their thinking, as well as more collaborative and creative. A night of modest tippling may have ushered in these feelings of freedom — though, the morning after, instincts to conform and submit would have kicked back in to restore the social order.

Some evidence suggests that these early brews (or wines) were also considered aids in deliberation. In long ago Germany and Persia, collective decisions of state were made after a few warm ones, then double-checked when sober. Elsewhere, they did it the other way around.

Beer was thought to be so important in many bygone civilizations that the Code of Urukagina, often cited as the first legal code, even prescribed it as a central unit of payment and penance.

Part of beer’s virtue in ancient times was that its alcohol content would have been sharply limited. As far as the research has shown, distillation of alcohol to higher concentrations began only about 2,000 years ago.

Today, many people drink too much because they have more than average social anxietyor panic anxiety to quell — disorders that may result, in fact, from those primeval herd instincts kicking into overdrive. But getting drunk, unfortunately, only compounds the problem: it can lead to decivilizing behaviors and encounters, and harm the body over time. For those with anxiety and depressive disorders, indeed, there are much safer and more effective drugs than alcohol — and together with psychotherapy, these newfangled improvements on beer can ease the angst.

But beer’s place in the development of civilization deserves at least a raising of the glass. As the ever rational Ben Franklin supposedly said, “Beer is living proof that God loves us and wants us to be happy.”

Several thousand years before Franklin, I’m guessing, some Neolithic fellow probably made the same toast.

Jeffrey P. Kahn, a clinical associate professor of psychiatry at NewYork-Presbyterian Hospital, is the author of “Angst: Origins of Anxiety and Depression.””

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by | March 17, 2013 · 4:07 pm

Drink to your health!

SATURDAY, FEB 2, 2013 06:00 PM EST
Drink to your health!
This piece originally appeared on Pacific Standard.

“The University of Washington has announced that “researchers employing a century-old observational technique have determined the precise configuration of humulones … that give beer its distinctive flavor.”

Now, if this were us doing the research, and we were inspecting some humulones, that observational technique would likely involve a sixer of imperial IPA, Pure Prairie League’s “Bustin’ Out” on vinyl, and (for later in the night) a white plastic bucket to be ridden like a bronco.

But the U-Dub research is considerably more sophisticated. And it has implications not just for beer-quaffing but for the treatment of disease.

The university teamed with a Seattle pharmaceutical firm to, once and for all, resolve the structure of the acids that are created by hops, which are used as a bittering agent in beer. Such compounds, they say, play a role in reports that moderate beer drinking can have positive health effects — on diabetes, forms of cancer, inflammation, even weight loss (explain that to some of my old college classmates).

“After decades of confusion,” they report in a study published this month by the journal Angewandte Chemie International Edition, they’ve determined — using X-ray crystallography (something nobody ever lets us use around beer) — the “handedness” of the molecules. That’s important to understanding how the molecules will relate to each other and, in turn, whether those positive effects will be created.

“If they are paired correctly, they will fit together like a nut and bolt,” a release from the university states. “If paired incorrectly, they might not fit together at all or it could be like placing a right hand into a left-handed glove.”

Or worse than putting a right hand into a left-handed glove – putting a mutant limb into a left-handed glove. The paper’s lead author cites the use of thalidomide for pregnant mothers’ morning sickness in the middle of the 20th century. When the molecules in that drug shook hands properly, thalidomide worked properly. When they got into a fistfight, the drug produced horrific birth defects.

“Now that we know which hand belongs to which molecule, we can determine which molecule goes to which bitterness taste in beer,” the author says. And, potentially, which of these “humulones” can be prescribed as treatment.

Now, anybody willing to make a wager on how long it will take Dogfish Head to release a “Dr. Humulone’s Good-Time Medicine 60-Minute Belgian Black Ale Aged in Charred Chinese Pine Barrels”?

To your health!”

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by | February 3, 2013 · 8:08 pm