March 23 (SeeNews) - Appealing to beer aficionados bored with traditional lager, craft beers have met with a warm welcome in Southeast Europe (SEE) but high production costs and large-scale investment in equipment needed to operate on a market dominated by international majors have made craft brewers explore new models of collaboration.
In just three years since they appeared in SEE, local craft brewers have secured a firm foothold on the market. Since 2014 their number has increased to more than 20 in Serbia, as many in Croatia and some 15 in Bulgaria as production and sales are rising sharply.
“The market is getting it, they try our beer and they see the difference […] And more and more brewers are appearing,” Branimir Melentijevic, owner of Kabinet, Serbia's first craft brewery, tells SeeNews as we sit together with two other craft brewers – Karel Roell, the owner of Bulgaria's White Stork, and Axel Deshayes, the man behind Croatia's Visibaba, in Kanaal, a craft beer pub in Sofia.
Together with his wife, Melentijevic opened the state-of-the-art brewery – a greenfield investment some 50 kilometres east of the capital Belgrade - in 2014. In three years, the brewery created over 40 different beers and its capacity tripled to 32 hectolitres (hl) per month. Currently, the brewery has a staff of seven people.
“We started with 2,000-litre tanks, we are now planning 8,000-litre tanks,” Melentijevic says, adding that last year the brewery's output grew by roughly 20-30%.
“Everyone is talking about craft beer and it is growing hot,” Roell comments. His White Stork brewery, which was launched in 2013, increased its production 55% to 320 hl in 2016.
“The [craft brewing] movement is getting stronger. There is more talk about craft,” Deshayes adds.
SHARING UP
Visibaba, which today makes 10 hl per month, started four years ago as a home brewery in Croatia. As demand from friends grew, Deshayes began to contemplate going commercial and started looking for facilities where he could make the beer he wanted.
“We were looking in the area – first in Croatia because it is easier – for a brewery but we couldn't find one at the time because craft brewing is not so popular. The quality of breweries in Slovenia was not up to the mark either,” Deshayes recalls. “No one at the time knew about high fermentation used in making ale, they only knew about making lager.”
At that time Kabinet was the only brewery near Croatia which had the equipment Deshayes needed. “We said, 'Let's do something together.' We launched our own brand as a ghost brewer – we use his facility and his brewmaster, we know the recipes and they produce the beer.”
This model of collaboration where so-called gypsy or ghost brewers rent production space from other brewers and thus save on large-scale investments has become common practice in Southeast Europe. For their part, the host breweries earn revenue on what could otherwise be unused capacity. The ghost brewers in turn can invest more in new recipes. The exchange of creative energy among like-minded entrepreneurs eager to experiment with tastes leads to the creation of extraordinary new brews, to the delight of customers.
“I wouldn't open my brewery even if I had the money, that's my mentality. I like to go different places,” says Deshayes. “When Kabinet does not have the capacity I need to make a certain beer, I will go to someone else. I could go to Vietnam.”
Currently, only five of the 20 craft brewers in Serbia have production facilities. In Bulgaria a third of craft brewers are ghosts.
White Stork for one is being made in The Netherlands, Belgium and in Romania, as well as in Kabinet. “We met with Kabinet in 2013. Same story – we were looking in the area who could make our beer, who had the best equipment to make our beer,” Roell recalls.
Caught up in the spirit of sharing up, non-brewers too have been tempted to make craft beers for special events. For its fourth anniversary Kanaal, the first craft beer pub in Sofia, came up with an IPA brewed in Romanian craft brewery Ground Zero.
However, it is not just the sound business case that brings craft brewers together, according to the three brewers.
“This collaboration here is functioning because we had the same vision about creating unseen things, pushing the limits, changing the concepts of what is classical beer or even classical craft beer,” Deshayes points out.
“It's the punk mentality that we all carry together in making beer taste differently,” Roell is quick to add.
“We are expanding the idea [...] we are forming a sort of culture,” Melentijevic says. “There is a business case, but is it rather a voyage, every day you discover a new beer.”
GOLDEN BROWN, TEXTURE LIKE SUN
In their quest for new tastes, craft brewers have created some remarkable mixes. White Stork's latest launch is a hibiscus-infused IPA made in Dutch brewery De Molen. Another popular Bulgarian craft beer brand, Ailyak, is experimenting with echinacea, whereas its peer Rosebrew is made with organic rosewater. Plum Ale, a collaboration between two Bulgarian craft brewers - Blek Pine and Divo Pivo – has a plum taste, as the name suggests. Blek Pine has already experimented with apricot-tasting ale, whereas Divo Pivo recently offered its fans an ale with camomile, bourbon geranium and rosehip.
Visibaba mixes lemons and orange peels from the island of Vis with coriander from Jamaica, whereas Pop My Cherry, a collaboration between White Stork and Kabinet, brings together sour cherries and almonds. Lemon balm, honey, hemp, orange and mandarin are also among Melentijevic's favourite ingredients. Kabinet has made Melisa - a lemon balm pale ale, and recently in collaboration with Zagovor brewery produced Uteha - a stout with honey.
“We can play with so many different things – you have 80 different malts, probably 120 styles of hops and more than 30 types of yeast,” Roell explains.
THE PRICE OF BEING DIFFERENT
However, going against the grain comes at a cost.
In Bulgaria there are only four kinds of hops, and specialty malts are very rare, as the maltery in Pleven, in the north central part of the country, does not make specialty malts and its services are focused on the big market players.
The situation in Croatia and Serbia is not much different.
“This explains the price which is higher because we have to import everything,” Deshayes says. “It's easier for Belgian people, they have the malts, beer-making is already an established institution there. Here were are fighting for doing it.”
“The price of hops that we are buying is the same that of the other craft brewers are using, we are buying in the US, New Zealand,” Melentijevic adds. “Yet you cannot expect to have the return that a US brewery has just because you are not there. It is not a matter of quality.”
People's low purchasing power tightens margins further for craft beer makers and craft beer pubs. Manpower and overheads are cheaper but they make only a small portion of the costs.
The price of the imported craft beer is at least two times as big as the industrial local beer, and beer here is definitely cheap compared with the price of same beer charged in Western countries, Liubomir Chonos, owner of Kanaal, joins in. “It's more than twice cheaper than in The Netherlands, and yet the market is just about at that point where it is not affordable at all and that is quite a big problem.”
Exports give craft brewers a breath of air. Kabinet for one is exporting to the other countries of ex-Yugoslavia, Italy, Romania, Russia, Germany, Austria, The Netherlands, Belgium, Denmark, and Norway, and is planning to start selling its output in the U.S. shortly.
As their popularity grows, craft beers are no longer sold in specialised shops and bars only, but in big retail chains as well.
“The spread in distribution does not mean mass production and that's important in craft,” according to Deshayes. “I see this as a challenge – to put the product where you are not expected. If you rely only on the craft shops, you don't make it on the market, you have to spread out and make it available to more people.”
“The whole thing is about making mind-blowing beer, and see what happens,” Roell concludes.