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Beer production line.
Reuters/Rick Wilking
Pour one out for the homies.
BOTTOMS UP

Classic American beers like PBR and Lone Star could stop being produced in 2020

Ephrat Livni
By Ephrat Livni

Senior reporter, law & politics, DC.

Pabst Blue Ribbon beer, affectionately known as PBR, is a favorite of hipsters across the US. But a dispute between two classic American breweries means that the fate of this watery, old-timey drink is up in the air.

Miller Coors brews many of Pabst’s beers, an arrangement that’s relatively common in the industry. The arrangement has been in place since 1999. Now a trial is underway in Milwaukee, Wisconsin—where Pabst was founded in 1844—to determine whether Miller Coors must renew a brewing contract that’s set to expire in 2020.

Miller Coors claims that it can’t afford to keep brewing for Pabst, and that it has to either terminate the agreement or make  substantial changes to the contract’s terms. Meanwhile, Pabst is suing for about $400 million in damages and an order to renew the deal, arguing that Miller Coors is trying to put it out of business by making an untenable hike in service prices a condition of the extension.

Miller Coors contends that Pabst doesn’t want to pay what the brewing service is worth and that it’s under no obligation to renew unfavorable terms. The company moved to dismiss the Pabst claim earlier in the year, saying it has the sole discretion under the terms of the deal to decide whether to negotiate an extension.

But Pabst’s lawsuit argues that Miller Coors isn’t operating in good faith. At a March hearing, Pabst claimed to have “stunning documents” that show the opposition hired a consultant to help Miller Coors take over the market and push Pabst to extinction.

The only other American brewery with the capacity to manufacture as much beer as Pabst needs is Anheuseur-Busch. Together, Miller Coors and Anheuser Busch have a hold on almost 70% of the US beer market. But beer sales are dwindling overall as wine and spirits become more popular. And even among beer lovers, classic brands are losing love, which makes Pabst’s struggle for survival all the more difficult.

US beer sales have declined, with shipments down from 213 million barrels in 2008 to 204 million in 2017, according to the Brewers Association, which represents craft and independent breweries. “The beer market has shifted and beer lovers are increasingly demanding more variety, fuller-flavor, and local products from small and independent producers,” Bart Watson, the Brewers Association’s chief economist, told Boston magazine.

In the age of the microbrewery and beers infused with everything—hemp, honey, jalapeños, oatmeal, coffee, and maple syrup, yeast from the beards of brewers, and bull testicles, among other flavor aids—there is still a taste for watery classics that make drinkers nostalgic for simpler times. But fans of brews like PBR, Colt 45, Pabst, Old Milwaukee, Lone Star, Old Style, Natty Bo, Rainier, Schlitz, Olympia, Stroh’s, Schaefer, Schmidt’s, Pearl, and Blatz may have to put the past behind them if Pabst can’t get MillerCoors to renew.

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