Fermenting change: Three keys to a bright future for brewers
Sept. 16, 2024
The brewing industry faces global upheaval, grappling with shifting consumer preferences, rising costs and environmental challenges. As brewers seek to innovate while honoring tradition, those who adapt will thrive. On the 150th anniversary of our brewing legacy, we explore three imperatives for breweries to succeed in this ever-changing landscape.
Global headwinds facing brewers
The beer industry faces turbulence worldwide. From China to the U.S., after decades of steady increases, global beer production has stalled in recent years. In fact, compared to its 2015 peak, production dropped by more than 4% in 2023, falling to 1.88 billion hectoliters. In large beer-producing countries, rising energy costs, fluctuating raw material prices and labor shortages are putting unprecedented pressure on brewers. These challenges are compounded by the lingering impacts of the covid pandemic, which reshaped the beer market and left its mark on production and distribution.
Consumers are also evolving. Demand for low- and non-alcoholic beverages has surged as more people adopt healthier lifestyles. Younger generations are more experimental in their beverage choices and often lack the brand loyalty that breweries have traditionally relied on. Craft beers and flavor innovation within the industry are gaining momentum, pushing traditional brewers to reevaluate their strategies.
While the German market has seen some of the steepest declines – a 3.3% drop in beer consumption in 2023 – the issue is far from local. Breweries around the globe are having to rethink how they operate, by becoming more flexible, sustainable and digital.
Be more flexible
Young consumers crave variety and new experiences; they are breaking ties with traditional brands. To meet these evolving expectations, breweries need to become more versatile and efficient.
Technically, there are very few hurdles to expanding beyond traditional beer and offering popular beverages like mixed drinks, hard seltzers and kombucha or ready-to-drink cocktails. For breweries that already have a brewhouse for producing the sugar base and technology for fermenting, blending, carbonating and bottling, adding or transitioning to new products is quite simple. A broader product portfolio, together with holistic engineering approaches and just-in-time production capabilities, allows breweries to swiftly adapt to meet the changing demands of a highly dynamic market.
The low-alcohol and alcohol-free beer segment is the only growing segment in the beer market. This presents a chance for breweries to attract a new, health-conscious audience. Convincing real beer lovers to try non-alcoholic versions is no easy feat, but it’s one worth pursuing. In Munich, Germany, the Augustiner Brewery, founded in 1328, recently hit a home run by twinning one of its world class pale lager beers and creating a non-alcoholic version. The first new product they’ve launched in 38 years, demand has far exceeded their expectations. In fact, GEA is helping many customers reduce the alcohol content of their beer to 0.0% while maintaining full flavor and supports customers in the production of non-alcoholic ciders and wine. What’s more, the resulting alcoholic base can serve as the foundation for hybrid alcohol products such as beer mixed drinks (beertails) or hard seltzers which are trending
Limited-edition seasonal beers, like sour beers, or those with unique (curated) ingredients, can help breweries build a loyal fan base and strengthen brand loyalty. Craft breweries are leading the way in this, collaborating and building close relationships with their local communities and participating in local events as a way to generate additional revenue and foster social cohesion.
Be more circular
As an energy and water-intensive industry, breweries face challenges such as climate change, resource scarcity and unstable supply chains. The goal is to reduce inefficiencies throughout the value chain while opening up new business opportunities. Growing awareness of the connections between nutrition, health, biodiversity and climate is encouraging creative concepts that make breweries more circular and therefore more resilient.
The brewing system of the future will be determined by a sophisticated process design and the use of state-of-the-art technologies. Anyone aiming for net-zero CO2 emissions or a 1:1 ratio of “water used to beer sold” must drastically reduce their resource requirements. According to calculations by GEA experts, large breweries can reduce their energy consumption for a new building by up to 90 percent. However, this comes with prerequisites: rethinking traditional workflows, timings and the technologies used.
Three established recovery technologies already play a decisive role in helping breweries become more circular:
- Heat pumps: Commonly used in district- and residential heating, in brewing, heat pumps recover waste heat from the refrigeration system, raising the temperature of the waste heat to make it suitable for other production processes (e.g., preheating water for cleaning or pasteurization).
- Mechanical vapor recompression (MVR): This process captures vapor from the most energy intensive step in brewing – wort boiling – and recompresses it back into steam for further boiling.
- CO2 recovery: Already used by many large breweries, a recovery system captures CO2 from the fermentation process so it can be recycled in other in-house production processes or sold on for use by the food industry.
The brewhouse is the heart of the brewery. It is also historically a huge consumer of energy. This has to change. Fractionated practices, like only boiling what is required and reusing energy (heat) multiple times in processes, are already challenging traditional brewhouse paradigms. At BrauBeviale 2023, GEA presented a new wort boiling system that reduces energy consumption by 60% and halves wort boiling time.
In the future, waste won’t exist as we know it. Everything will be viewed as a co-product – a resource to reuse or sell. This is untapped potential that many brewers haven’t even begun to explore.
Dr. Mark Schneeberger
Senior Director Product Development, R&D, GEA
Upcycling waste products is a powerful lever for breweries to make better use of their resources and tap into additional revenue streams. Spent grains, brewer’s yeast and other carbohydrate by-products hold untapped potential. Beyond agricultural uses, such as animal feed or fertilizer, brewery waste is a valuable resource, for example as functional ingredients for vegan products, pasta and bioplastics.
“In the future, waste won’t exist as we know it. Everything will be viewed as a co-product – a resource to reuse or sell. This is untapped potential that many brewers haven’t even begun to explore,“ says Dr. Mark Schneeberger, Senior Director Product Development, R&D at GEA.
Be more digital
Precision is key to efficiency and increased sustainability in beer production. Digitalization and automation offer enormous opportunities to make processes more predictable and resource efficient. At the GEA Brewery Talk at BrauBeviale 2023, beverage industry experts Manfred Schmidt from Krombacher Brauerei and Steffen Löser, who helped steer beverage giant Coca-Cola Europacific Partners through its digital evolution, agreed: If the will to change is there, zero-emission plants and AI-supported beverage productions are within reach.
“Digitalization is not a savior, but it does create transparency around data and its links,” Löser explained, adding that his experience in the beverage industry can be transferred one-to-one to breweries. For example, AI can take measured values and turn them into actionable information for machine operators, production planning, purchasing and sales. The more advanced analytics are integrated, the more complex algorithms reveal insights that a human brain simply can’t detect.GEA has begun to connect previously isolated data sources with its real-time monitoring software at breweries and then augment this with predictive AI. This improves the sustainability of brewing processes. For example, GEA InsightPartner Brewery analyzes sustainability KPIs based on energy consumption and heat recovery in the process cycle and suggests efficiency improvements. In the future, GEA OptiPartner Brewery will be able to optimize breweries in autopilot mode at the touch of a button, increasing plant productivity and safety.
AI is becoming a liberating force for brewmasters, enabling them to focus on brewing instead of data analysis. Given the shortage of skilled labor in the industry, highly automated processes are not just an option, but a necessity. Technology will make this much easier, and AI will take over the orchestration of complex processes – improving circularity as well.
Trusting in the potential of digitalization requires more than just technical know-how – it requires a desire for progress and an uncompromising rejection of waste in production. Every bottle of beer that sits unwanted on the shelf is a waste of valuable resources,” says Manfred Schmidt, Technical Managing Director at Krombacher brewery. He is right. We can do better.
Fermenting change
The brewing industry faces mounting challenges: shifting consumer demand, rising costs and urgent environmental concerns. Adaptation is key, and flexibility, circularity and digitalization are the pillars upon which future success will need to be built.
Breweries that embrace innovation will thrive by turning waste into valuable co-products; will use AI to increase efficiency and adopt flexible production methods to meet evolving tastes.The brewing industry has proven its craftmanship – now it must prove its readiness to change. Adaptation is essential. GEA’s customers, combined with our long brewing tradition, give us the confidence to move forward boldly.
