Beer in Canada
Beer was introduced to Canada by British settlers in the seventeenth century. The first commercial brewery was La Brasseries du Roy started by New France Intendant Jean Talon, in Québec City in 1668. Many commercial brewers thrived until prohibition in Canada. The provincial and federal governments' attempt to eliminate "intoxicating" beverages led to the closing of nearly three quarters of breweries between 1878 and 1928. It was only in the second half of the twentieth century that a significant number of new breweries opened up. The Canadian beer industry now plays an important role in Canadian identity, although globalization of the brewing industry has seen the major players in Canada acquired by or merged with foreign companies, notably its three largest beer producers: Labatt, Molson and Sleeman. The result is that Moosehead, with an estimated 3.8 percent share of the domestic market in 2016, has become the largest fully Canadian-owned brewer.
Beer sales have been sluggish overall in volume and in growth in industry revenue as other beverages have increased in popularity. Growth in revenue for beer makers averaged 1.3 per cent per year during 2011–2016; the estimated annual growth over the subsequent five years is only 0.4 percent per annum. Nonetheless, the number of licensed breweries in Canada increased from 310 in 2010 to 640 in 2015. Many of these are small operations since there were only 30 large breweries in 2015.
The production of beer by microbreweries is a very fast-growing segment both in terms of the number of producers and the volume sold. Craft brewing appeals to a wider demographic than the traditional mass-market beers which primarily target young males.
Popularity
Beer can be considered a culturally important aspect of the stereotypical Canadian's life. Beer is the most popular alcoholic beverage in Canada, in terms of both volume and dollar value.Industry statistics indicated that in 2015, beer was the country's most popular alcoholic beverage and the products brewed in Canada held an 85 per cent share of the domestic market. The top selling style of beer in Canada is, by far, the pale lager. This type is also called North American Style Lager. In 2016, the best-selling brand was Budweiser, with many of its products manufactured in Canada.
While Canada's population is growing, sales of beer have increased only minimally. The volume of beer sold increased by only 1.7 per cent per year in the previous decade. Of that, domestic beer accounted for 1.1 per cent of the increase, while imports made up the balance. In terms of market share in dollar value, beer's share dropped from 47.9 per cent to 42 per cent in ten years, mostly due to the increasing popularity of wine. Imported beer sales, in volume, have grown significantly, increasing at an annual average rate of 6.0% between 2004 and 2014.
The annual Canadian Brewing Awards recognizes the best beers in Canada using blind taste tests. Most of the winning beers tend to be from craft brewers, however, some larger brewers continue to place well.
History
Beer was first introduced to Canada by European settlers in the seventeenth century, as Canada had an ideal climate for making beer before refrigeration was introduced. However, the preferred drink of the citizens of New France was imported wine or brandy. Although the first commercial brewery was built by Louis Prud'homme in Montreal in 1650, it failed. Jean Talon, the first appointed Intendant of New France put limits on the amount of wine and spirits that could be imported and established the La brasserie de Roy in Quebec City, in the year 1668. This brewery also failed after Talon returned to France in 1672 and import limits were increased. What instead sprung up was the development of spruce beer, both alcoholic and non-alcoholic.File:Alexander Keith Brewery, Halifax, Nova Scotia.jpg|thumb|Depiction of Alexander Keith's Brewery in Halifax, Nova Scotia,
After the fall of New France, the numerous British soldiers in the Canadian British colonies in the eighteenth century was a benefit to breweries since the troops were each entitled to six pints of beer per day. Most preferred ales and other heavy beers, not lager. Another important base of customers was the British Loyalists that immigrated from the newly independent United States to Canada. During those centuries and into the nineteenth, a number of commercial brewers thrived, including some that became the staple of the Canadian industry: John Molson founded a brewery in Montreal in 1786, Alexander Keith in Halifax in 1820, Thomas Carling in London in 1840, John Kinder Labatt in 1847, also in London, Susannah Oland in Halifax in 1867, and Eugene O'Keefe in Toronto in 1891. The Upper Canada government issued a patent on July 6, 1842, to George Riley of Kingston, Upper Canada for "an improved method of brewing ale, beer, porter, and other malt liquors." Molson's is the oldest surviving Canadian brewing enterprise.
Prohibition in Canada did not last as long as in the U.S. and was largely over by the mid-1920s, apart from Prince Edward Island, where it ran from 1901 to 1948. By comparison, the Temperance Act in Ontario ran from 1916 to 1927. The relatively large and powerful beer manufacturing sector - and the huge working class that purchased their products - failed to convince any of the provincial governments to reverse their stance on prohibition.
File:Commission des liqueurs, en 1945.jpg|thumb|Queues outside a Commission des liqueurs du Québec store, 1945. The end of prohibition in Canada saw a number of its provincial alcohol authorities created and charged with the distribution of alcohol.
After the ending of prohibition, the sale of alcoholic beverages remained heavily controlled by government liquor boards and publicly owned stores in each of the provinces. Public drinking returned to jurisdictions often several years after the end of prohibition. The controls led to the growth of "beer parlours" also known as "taverns" which had no bar, did not serve meals and people sat and drank at cafe tables, where the beer was delivered by the glass, patrons could not move between tables, could not stand up with a drink and had other restrictions. Many beer parlours were segregated by sex, and had a men's only room, and a room for "ladies and escorts". The beer parlours, where often the only thing allowed was to drink and was often the only place to drink in town was considered a factor in making beer a national drink of Canada.
A period of consolidation occurred after the ending of prohibition and the brewing industry became extremely concentrated in Canada by the 1960s, dominated by just three companies. Together, all three had bought or merged dozens of smaller breweries, sometimes moving their products to another brewery or closed outright.
Foreign ownership and consolidation
In 1969, Canadian Breweries was sold to the Rothmans International multinational and renamed Carling O'Keefe. After a brief ownership by Australian Elders XL, Carling O'Keefe merged with Molson in 1989, then merged with US company Coors in 2005 to create Molson Coors, now the world's fifth-largest brewing company. Labatt's was purchased in 1995 by the Belgian company Interbrew. With the purchase of Sleeman Breweries, the largest remaining Canadian brewer, in 2006 by the Japanese-owned Sapporo Brewery, Canada's beer production has been mainly under the control of multinational companies, mostly foreign-owned.By the end of 2006, nearly 90 per cent of beer sales was brewed domestically under license from non-domestic corporations. American beers brewed under license have become the top sellers in the market, and by 2008 Budweiser was the top-selling brand with 13 per cent of the market, followed by Coors Light with 12 per cent. Molson Canadian and Labatt Blue, for decades the top-selling brands, now hold third and fourth place.
According to Agriculture Canada, the three major breweries accounted for approximately 90 per cent of retail sales in 2012. While annual exports, primarily to the U.S. are significant, industry analysts expect a decline at an annualized rate of 1.6 per cent starting in 2016, due to the increasing popularity of U.S. brewed products. As well, Canada was a net importer of beer in 2014, with imports totalling million against exports of million.
A merger between Anheuser-Busch InBev and SABMiller closed on October 10, 2016. The new company, Anheuser-Busch InBev SA/NV, is trading on the Brussels stock exchange as ABI.BR and as BUD on the New York stock exchange. SABMiller ceased trading on global stock markets.
As per the agreement with the regulators, SABMiller sold to Molson Coors full ownership of SABMiller, including the Miller brand portfolio. Molson Coors now owns all of MillerCoors; the latter is "the U.S. business unit of Molson Coors". As a result, Molson Coors regained the right to make and market Miller Genuine Draft and Miller Lite in Canada.
The largest fully Canadian-owned brewer, Moosehead Breweries, controlled about 3.8 per cent of the Canadian market in 2016.
Growth of microbreweries
The revival of craft brewing dates from the early 1980s, according to Ian Coutts, in his book Brew North: How Canadians Made Beer and Beer Made Canada as a result of disparate and random factors. The factors included an article in May/June 1978 issue of Harrowsmith magazine by a former O'Keefe employee decrying the state of the business, the creation of the Campaign for Real Ale in the United Kingdom, the revival of smaller brewers in the United States beginning with Anchor Brewing in 1965, the 1981 deregulation of beer prices in British Columbia by minister Peter Hyndman and the resulting price hikes by the "Big Three". In June 1982, the Horseshoe Bay Brewery in West Vancouver opened, creating one of Canada's first microbreweries.Despite the dominance of the foreign-controlled major brewers, the numbers of microbreweries has been increasing. There were 88 microbreweries in 2006. There was a 50 per cent increase in the number of independents between 2010 and 2015. By that year, there were 640 licensed breweries in Canada. That number may be as high as it will go. The trend is that as one microbrewery closes another opens to take its place.
Craft beer sales are increasing. In Ontario for example, there was a minimal increase in sales volume for the majors' products while craft beer sales increased by nearly 36 per cent in 2015. Beer produced by microbreweries accounted for 10% of the Canadian beer market in 2015, and the microbrewery industry has been experiencing rapid growth.
The growth, particularly in sales volume, is particularly noteworthy in Ontario, where craft brewers experienced a 36 per cent increase in sales in 2015. In mid-2016, there were 140 such breweries operating in Ontario. British Columbia's craft beer industry has also experienced major growth, from 54 in 2010 to 118 such operations in 2015. These small British Columbia breweries benefitted from a 35% increase in the volume of beer produced in 2016 vs. 2015. On a Canada-wide basis, demand for craft beer is steadily increasing and the maturity point for this industry is still a long way off, according to Taps magazine, published by the parent of the Canadian Brewing Awards.
File:Creemore Springs.JPG|thumb|Exterior of Creemore Springs brewery in Creemore, Ontario. Creemore Springs was one of many microbreweries that was acquired by a larger "macrobrewery".
One way the "macrobreweries" have dealt with the threat of this slow but steady growth of Canadian craft brewers is by buying them outright. For example, Creemore Springs of Creemore, Ontario was bought by Molson Coors in 2005, and Creemore subsequently acquired Granville Island Brewing in 2010. Mill Street Brewery of Toronto, Ontario, was purchased by Labatt in late 2015; after the acquisition had been completed, Mill St purchased Brickworks Ciderhouse and brought it under the Labatt umbrella of companies as well. In October 2015, Labatt had also purchased Turning Point Brewery, a craft beer maker in Delta, BC that brews Stanley Park beers. Other craft beers owned by major companies include Hop City owned by Moosehead, Unibroue and Upper Canada Brewing Company owned by Sleeman.