Following the tax excise on beer increasing again on February 5, at least three more breweries have fallen victim to the Australian craft beer recession.

The excise has added about 90c to the cost of every pint in a blow to both beer lovers and brewers.

Australian Brewers Guild, trading as Hawkers Beer and based in Reservoir in Melbourne, has appointed DBA Reconstruction & Advisory as its administrator. Mark Lieberenz and Anthony Phillips of specialist insolvency and restructuring firm Heard Phillips Lieberenz have been appointed the administrators of Big Shed micro brewer located in Royal Park.

Hawkers founder and managing director Mazen Hajjar said: “Post Covid has been a challenging period with bigger players increasingly restricting access to taps and shelf space, combined with broader economic pressures, including increased input costs and taxes. However, we are confident that the restructuring will ensure the business is in a stronger position to fight these challenges going forward.”  

Big Shed is continuing to trade the business as normal as it looks to restructure the operations of the company and to come to terms with creditors.

Lieberenz said: “We are open for business and look forward to continue brewing the full range of Big Shed beers and welcoming customers at the Big Shed.

“We are delighted to be working with a staff and management team who feel as passionate about their business as they are about their products,” said Mr Lieberenz.

Co-Founder Craig Basford added: “While no-one ever wants to be in this situation, we know that its necessary for our staff and business. We invested heavily in our business expansion up to December 2019 only for the world to shut down in March 2020. It is fighting that ongoing battle that has us where we are today.

“We appreciate this comes as cold comfort but we will be doing everything we can to get the best possible outcome for our creditors too. We want them to see the light at the end of the tunnel as much as we do. What we need now more than ever is the support of our community of beer drinkers, those who want see Big Shed around for the long haul.”

Lion ditches Steel City as craft beer recession bites

Newcastle’s Steel City Brewing has also ceased production after parting ways with Lion, which had been brewing the product in Sydney since its 2021 launch.

“It had always been our goal to establish a brewery and spiritual home within the Hunter Region to solidify our presence within our backyard,” Managing Director Oliver Semken said.

“However, amidst interest rate pressures and a subsequent downturn in consumer confidence, it made it increasingly hard for our business to rationalise funding our brewery aspirations given the current economic climate.

“Small breweries have found it particularly tough to regain their footing. Faced with these challenges in the industry, we considered our options and made the difficult decision to cease production, redirecting our focus towards enjoying beer in the Hunter’s great venues, rather than brewing it.”

Documents filed with the Australian Securities and Investment Commission (ASIC) on December 20, 2023 show Lion-Beer Spirits and Wine sold back its 270,000 shares to Steel City Holdings (the business’ holding company) for $80,310.33 in December. Learn more

IBA calls on government to adopt common sense reforms

According to the Independent Brewers Association (IBA) if the federal government does not act now on common sense reforms – our local independent brewing businesses will continue to close, and the cost of a pint will be out of reach for many Australian consumers.

It has called on government to adopt common sense reforms to ensure Australia’s vibrant independent brewing industry is not squeezed out of the market in favour of large multinational businesses.  

The IBA said: “In an environment where small breweries simply cannot keep absorbing costs – the Federal Government are the only ones that have the power to provide immediate relief.”

It has called on the Federal Government to implement three measures that would provide immediate relief by reducing the regulatory burden – even on a temporary basis:

1. Freezing indexation of alcohol excise for a period of two years.
2. The excise remission cap of $350,000 that was introduced in July 2021, should be indexed in line with inflation
3. Extending terms for repayment of excise debts that were deferred during the covid years. 

IBA CEO Kylie Lethbridge, said “Every time excise rates go up, my first thought is how many of our independent breweries are going to survive this round and who will close next.”

Price of a pint predicted to hit $15