Iowa’s craft beer industry continues to grow, industry experts weigh in on the potential “brewery bubble”

It's no secret that Iowa's craft beer industry has been growing, and it seems the trend is only going to continue.

'It's growing rapidly across the country and Iowa's no exception,” confirmed J. Wilson, 'Minster of Iowa Beer,” for the Iowa Brewers Guild.

In fact, a 2014 economic impact survey showed Iowa's craft beer industry was projected to triple production by 2019 - from about 41,000 barrels per year to 146,000. That's a more than 500 percent increase.

But, in the grand scheme of things, Iowa's craft beer industry is 'still fairly small,” Wilson said.

Of all the beer sold in the state, only 1 percent is produced in Iowa, he explained. And nationwide, craft beer holds just 12 percent of the market, according to the Brewers Association.

'Some people think it's bigger than it actually is, but it's a bunch of tiny businesses working to grow in small town communities in some cases,” Wilson said. 'But people are drinking more local craft products than mass marketed products, so those guys are losing market share. It's the local product people are gearing toward, and there's still a lot of room to continue to grow.”

Iowa's first craft brewery - Millstream in Amana - opened in 1985. Since then, more than 70 have opened and even more are in planning. Before prohibition, Iowa had at least 150 breweries, Wilson said, adding that 'we're really just returning to something that was common many decades ago.”

While there may still be room for more, that doesn't mean there aren't challenges ahead.

Getting craft beer onto grocery shelves and restaurant tap lines, for example, can be competitive, Wilson said. Before, brewers were competing against big names like Budweiser. Now they're up against their fellow local brewers.

And with consumers more 'savvy and educated about beer than ever before,” Wilson said brewers 'better have their quality under control.”

'There's plenty of market share to go around, but breweries putting out poor beer are going to struggle to make it,” he explained. 'You have to have the whole package: good branding and excellent brewing skills. If you don't have the whole package then you won't see that giant growth.”

By and large, Wilson said Iowa's breweries are putting out high quality products - award winning beers, in fact, including those from Corridor breweries Lion Bridge Brewing Company, Iowa Brewing Company and Millstream Brewing Company, which has earned several awards over the past three decades.

But not every brewery is looking for 'giant growth.”

In fact, most of Iowa's craft breweries are producing less than 500 barrels each year and the 2014 economic impact survey showed just five breweries - Toppling Goliath, Millstream, Backpocket, Confluence and Peace Tree - accounted for nearly 60 percent of the state's total beer production.

'The challenge with the craft beer boom is knowing when you've hit your sweet spot,” said Quinton McClain, owner and head brewer at Lion Bridge Brewing in Cedar Rapids.

'A lot of breweries get caught up in growing just for the sake of growing, but you can grow too fast and hit a wall,” he said. 'Some breweries are trying to grab a piece of the pie that's not really there and that only dilutes your connection with your customers.”

Since they opened in 2014, Lion Bridge has grown from producing 600 barrels per year to more than 2,500 barrels each year, but they intend to continue growing naturally and sustainably, McClain said.

'Really our focus is the community and feeling proud about the beer that is produced here,” he said. 'At this point, we have a well developed brand, but we're never going to conquer the world.”

Meanwhile, Solon-based Big Grove Brewery just launched its second location in a 26,000-square-foot former lumber warehouse in Iowa City, growing its production capabilities from around 1,200 barrels each year to potentially 10,000 barrels a year.

'We couldn't keep our beer on tap,” said Danny Standley, general manager of Big Grove in Iowa City.

'We were doing our best to fill those needs, but it was impossible to keep up with the demand. Now we have plenty of room for expansion.”

Clock House Brewing in Cedar Rapids is on the verge of opening - possibly in June - as it puts the final touches on its small taproom tucked behind Black Sheep Social Club.

The operation is starting very small - producing just 15 barrels - but part owner and head brewer Todd Viall said he hopes to see it grow.

'I think everybody wants to grow,” he said. 'But for now we'll take it slow, one step at a time. The first step is developing our recipes.”

Viall, who's been brewing beer for 23 years, said he plans to have a couple flagship beers, but otherwise intends to experiment with rotating taps of new and ambitious brews.

'We want people to have a new experience every time they come in,” he said.

As for opening a brewery surrounded by so many others? Viall isn't worried about it.

'I think there's tons of room in the Midwest,” he said. 'I don't think we're saturated yet. And most people I talk to are excited about all the options.”

'It's a good time to be in Iowa because everybody's looking for craft beer,” Standley agreed. 'People's tastes are changing.”

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