Is Craft Beer Dying in the UK Post-Brexit? The Industry Is ‘Definitely in a Bust’ as Over 100 Breweries Go Bankrupt In 18 Months

A row of beer taps at a restaurant. (Photo: AP Photo/Gene J. Puskar)

Craft beer in the United Kingdom might just be in trouble. In the wake of Brexit, the COVID-19 pandemic, inflation and the energy crisis from the Russian invasion of Ukraine, craft breweries are closing at record rates, according to The Guardian.

The Guardian cited burdensome paperwork in the wake of the country’s decision to leave the E.U. as particularly damaging to craft brewers looking to export their beers.

“Everyone was saying ‘It’s too complicated to import anything from the U.K. anymore,'” craft brewer Kimi Karjalainen said, per The Guardian.

Karjalainen and his brother, Marko, invested approximately $89,000 into their craft brewery, Bone Machine. The U.K. microbrewery had focused a lot of its efforts on exporting beers to Finland, Sweden and Italy, to name a few. According to Karjalainen, the initial investment was meant to go to his parent’s retirement. Now, it’s gone.

Bone Machine is just one of over 100 microbreweries that have had to shutter their doors over the past 18 months.

In addition to the litany of challenges breweries have faced in a post-Brexit world, brewers can add impending duty laws to the long list. The Guardian also cited a shortage of carbon dioxide in the latest development of the energy crisis, and the fact that Russia’s invasion of Ukraine has raised the price of barley and hops.

“There are brewery shutdowns every year. That’s just normal business,” Yvan Seth, founder of independent craft beer distributor Jolly Good Beer, said, according to The Guardian. “But there’s more shutting down this year than in the previous eight years of doing business. Three years ago, a keg that cost £100 ($127) is now going to cost you £150 ($191) so the pubs go ‘No, we’ll skip on that.’ Staffing is hard. Electricity is still pretty expensive.”

According to the Society of Independent Brewers, the initial number of breweries within the U.K. as of January 1, 2023, was approximately 1828. The Guardian claims a total of 684 breweries are currently operating out of the U.K.

Trouble appears to be on the horizon for craft beer in the U.S. as well. The American co-founder of South London-based Forest Road Brewery, Pete Brown, surmises that the U.K. craft beer bubble is experiencing a burst, much like what happened in the United States in the late ’90s.

He shared his musings with The Guardian and claimed the following:

“Everybody thought it was cool, everybody started doing it and then everyone was competing to have the next big thing. And you can overwhelm your own market so that even your most loyal customers can’t tell the difference between your key brands and your one-offs. In a bust, people go back to things they recognize. And we’re definitely in a bust.”

Join the Whiskey Raiders Bottle of the Month Club, where you will receive hard-to-find bottles curated by Whiskey Raiders staff with a 90+ rating on whiskeyraiders.com plus live virtual tastings. Sign up here!