E-Malt.com News article: Mexico: Mexico starting to see the beginning of craft beer culture

For decades, Mexicans have grown accustomed to drinking beer made either by Grupo Modelo, which owns Corona or Cervecería Cuauhtemoc Moctezuma, whose beers include Sol and Dos Equis, and was acquired by Heineken in 2010.

But in the past few years, a dozen or more micro breweries have started to do what was until recently considered impossible – compete with the two incumbents. And they have cultivated a tiny but growing market, The Financial Times reported on September, 15.

The combination of recovery from a tough recession in 2009 and low inflation has boosted many people’s purchasing power. Companies such as Cerveza Minerva in Guadalajara, and Primus from Mexico City have begun to make small-scale but high-quality, artisanal beers that have tickled the tastebuds of Mexicans who are willing to pay for a premium product.

“We are finally starting to see the beginning of a beer culture here,” says Darío Rodríguez Wyler, founder and owner of Bodega 12, which produces two beers. “We use premium ingredients, and people can taste that.”

So far, such breweries have won over only about 3 per cent of Mexico’s beer market, with practically all the remainder split between Modelo and Cervecería Cuauhtemoc Moctezuma.

In addition, winning more market share is tough: both incumbent beer producers compete fiercely by scrambling to offer cash advances, along with furniture, fridges and even awnings to new restaurants, bars and corner shops in return for exclusive contracts.

The result, says Eduardo Godínez, co-manager of El Depóstio, an independent beer store and bar in Mexico City that offers up to 200 national and imported specialist beers, is that microbreweries are squeezed on to the sidelines. “It’s a duopoly,” he says.
Against that backdrop, at least two factors have come to the aid of the new breweries. The first is the sheer size of the Mexican market. With a population of 112 mln, Latin America’s second-largest economy is one of the world’s top beer consumers. That means there is still space to make specialist products even when two beer behemoths dominate the market.

The second factor is their own creativity – both in the products they have created and in how they have marketed them.

Mexico’s microbreweries have gone to extraordinary lengths to distinguish their beers from the Coronas and Negra Modelos. In Jalisco state, Cervecería Revolución has taken the historic route by creating a beer called Zapata, named after Emiliano Zapata, one of Mexico’s revolutionary heroes. Similarly, Minerva has named a beer Malverde, after the folklore hero Jesús Malverde, a sort of unofficial saint worshipped by some Mexicans, in particular drug traffickers, which gives it a kind of frisson for drinkers.

Another case of bold branding is Purple Hand and Salamandra, two honey beers produced by Mr Rodríguez Wyler, whose marketing targets the gay community. This mirrors a broader tolerance in Mexico, where many of the larger cities have become more liberal.

“Everyone has their niche,” he says of the new microbreweries. “It’s not that we help each other, but we don’t tread on each other’s toes, either.”

Nevertheless, Mr Rodríguez Wyler says the new microbreweries face an uncertain future. Credit in Mexico’s banking system is too scarce to allow rapid expansion. At the same time, and perhaps more important, it may be safer to stay small. The two incumbent producers could crush the microbreweries in an instant if they chose – for instance, by pressing suppliers of raw materials and bottles not to sell to them. “The big guys tolerate us now because we are small,” he says. “But if we became much bigger, who knows?”


16 September, 2011