Monday, March 17, 2008

Saint Patrick's Day Panic! Are Supply Shortages and Price Increases Caused by our Environmental Conscience?

Master Brewers are claiming that price increases in beer are due to the increase in demand for bio fuels, which in turn causes farmers to grow more corn to support the bio fuels industry and grow less hops for the beer industry!
Large breweries like Miller, are starting to own their source material by buying up farmable land. Seems smart, but it has the unfortunate affect of increasing the company’s water footprint: a big problem for breweries! In fact, the most expensive part of the brewing process is water. Water is the largest input into the process and largest output from the process. It takes a lot of energy and money to course water through the beer making system, not to mention the additional problem that every drop devoted to beer making is a drop not being used for making clean drinking water.
But wait, don’t turn from the pub now, there is some good news on the frontlines of the beer-to-suds wars. The industry tends to use terms like waste opportunities , microbial fuel systems and anaerobic digestive systems to describe some of the positive externalities related to the beer making – such as organic matter that turns solid wastes into energy producing material and processes that convert solid waste into reusable water. And beer activists will tell you (and yes, they actually exist) that rootlets, which are spawned from the malting of the barley, if collected, can be used for animal feed. Even reused hops, filtered from the finished wort, can be used as fertilizer, and, residual yeast has been touted as a good source for vitamin B and ends up in pharma products. These beer aficionados ( pardon, activists) will also tell you that the used beer cans and beer bottles can also be recycled. But we all know that recycling is trending down at a rate of 20% per decade, ensuring the beer industry will continue to be a menace to landfills for years to come.(

So is beer green or not? And if not, who among the brewers are greener than most?
The only economist who I would trust with this question is former Chief Economist for the City of New York and NYU Professor, John Tepper-Marlin in his Huffington Post Blog about the corporate social behavior scoring of three dominant players in the beer industry.

If professor Tepper-Marlin can save our Saint Patty’s day, perhaps he can next help us determine whether the beer industry really qualifies as an industry since the three largest players making up 80% market share or whether there might be something entirely different going on to drive up our beer prices!

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