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Archive for the ‘Economics of Brewing’ Category

Better Faster Cheaper Beer

Friday, August 17th, 2012

Brewer’s are always on the lookout for a killer recipe, a brew day improvement, or a way to take their brewing to the next level. When we taste a good quality micro brew, we say to ourselves: “I could brew that… but first I’d make a few changes…”.

Home brewers are self sufficient, determined, creative individuals who say NO to macro beer and the oxidized defects it teaches our pallets! It is in the very nature of home brewers to improve their craft, push the limits, and at times go over the edge.

There is better, there is cheaper, and there is faster.

beer better cheaper faster home brewing

Pick two and you’ll be fine.

Faster – less time on brew day and less time in the fermentor. Ales win (2 weeks vs 6-8 for lagers)! Kegging speeds up the bottling process but has high up front costs! Extract brewing, though faster on brew day is more expensive because of the added cost of the extract.

Cheaper – can’t get much cheaper than buying 2-row in bulk and using your own hops. However if you want cheap home brew, you are looking at light bodied, low IBU beers. One of our fellow brewers is exploring the possibility of using feed corn to get his price per pint even lower.

Better – think what most new micro breweries are doing with their beers. It is all about rich flavor and complex bitterness. There is even a new beer category in the making: see our article on Black Ales.  The pursuit of better beer is a money spending time consuming operation.

A note on lagers:
For clarification, as a class of beers lagers are not better than ales. However, there is no substitute for a good lager beer. It is too bad lagers take 4-6 months to make. This is proven to me personally by recent experiments: Mocktoberfest and Kölsch.

Oktoberfest yeast (WLP820 / Bavarian Lager 2206) and German Ale yeast (WLP830 / 2124 Bohemian Lager) impart an intangible flavor profile that not only defines their respective categories but makes them shine.



The Dark Side of Home Brewing

Wednesday, July 8th, 2009

Brewing has a dark side.  It has yet to be brought to light by the dozens of books I have read on home brewing.  The multitude of people online who I have connected with about brewing have never spoken about it.  The brewing industry itself wants us to believe it is a myth.  That dark side is alcoholism, or alcohol dependency, and it is a terrible component to drinking.  Not everyone is blessed with the ability to moderate their intake. Not everyone is smart enough to treat alcohol responsibly.  Every brewer should know what alcoholism and alcohol dependency are, and how dangerous a full blow case can be.

My goal with this article is to simply inform.  I want to be clear, I am not saying that brewing beer, going to pubs, and enjoying beer is a negative thing.  Alcohol is reported to have positive health benefits, when used in moderation. Drunk driving, loosing one’s spouse, or destroying one’s health are negatives that are involved with alcohol when it is used irresponsibly. Some people have a genetic predisposition to becoming an alcoholic, or a family history of alcohol abuse, which puts them at a higher risk.

Something I was not aware of is alcoholism and alcohol dependency are the same thing.

The word ‘dependency’ sounds so innocent.  The dependency leads to a steady progression associated with more and more alcohol intake, and that is what causes all the damage.

For the official medical description see: https://www.mentalhealth.com/dis/p20-sb01.html

Some Warning Signs:

  • If you are developing a tolerance for alcohol, and need to drink more to get the same effect, that is a warning sign.  Making up for drinking by exercising, eating healthy, and getting more sleep is only going to feed into increasing tolerance.

  • Inability to cut back is a warning sign. That means it is a habit, and the progression has started.

  • If you find yourself making excuses to justify drinking, that is a warning sign. These may include social drinking, celebratory drinking, drinking to reward oneself, or on the negative side, drinking to cope with stress, physical pain, or to numb negative emotions.

  • The idea that it isn’t alcoholism until it impacts your life in a major way is completely flawed. Even something as simple as a mild headache in the morning, weight gain, or slight depression is a health impact.  Consider that increased drinking is the cause. Multiply a mild headache over a month, or an extra few pounds over a year, and now it is a chronic condition. Over time, excess drinking will lead to problems in all aspects of life, especially the ones you care about most.

  • Bottom line: If you think you have an alcohol dependency you do, and you need to address it. Private counseling is one very good option. Self moderation is likely not to work. Only 20% of people are able to stop on their own. Beyond that, support from family, friends, and an alcoholics anonymous club should be sought out.

This website has a guide on what constitutes alcoholism, and a short quiz you can take yourself:
https://www.hsc.wvu.edu/som/cmed/alcohol/alcoholism/alcoholism.htm

What is at stake here?
Alcoholism has a progression.  It starts with a higher tolerance, which kicks off a cycle of increased intake.  At this point attempts to scale back may be unsuccessful.  This may continue for a number of months, years or decades.  Over the course of that time, long term drinking causes harmful health effects.  Its not just the liver that gets hurt. Research indicates the brain chemistry governing emotions of happiness are at stake. Hardened alcoholics actually loose the ability to enjoy themselves unless they have recently had a certain amount of alcohol. This is something alcohol has in common with harder drugs like meth.

Most home brewers are smart, hands on, creative, and self sufficient people. These positive attributes are made possible because of our brains. The thought of loosing that to alcohol is horrifying.   There are social impacts as well. Alcoholism effects the alcoholic and everyone around them.  The thought of loosing employment, spouse, friends, and faith is also horrifying.

Anyone who has a history of alcoholism or a family history of alcoholism should strongly consider avoiding home brewing as a hobby.

We brewers are often surrounded by alcohol, involved in the production of it, and even its perfection.

Home brewing ultimately leads to having large quantities of high quality beer on hand at a very affordable price.  At home you are surrounded by reminders of brewing – the equipment, the bubbling fermentor, the empty bottles, the spreadsheets on your computer’s desktop, the hops outside the house, and the closet or fridge full of beer just waiting to be enjoyed.  These reminders can be triggers for cravings.  Acting on those cravings repeatedly can lead to higher tolerance, and that is when the progression begins. The progression is dangerous because it can slowly creep higher and higher. There is such a thing as a functional alcoholic, but functioning at what level, and for how much longer?

In the past, I was always surprised to see a craig’s list post of a home brewer selling off their entire kit for a ridiculously low price.  My original thought was, once you figure out how to brew beer that is perfect to your own taste, why ever stop?  One explanation is they brewed themselves into alcoholism and were forced to choose between booze or life.



Brew House Efficiency Defined

Saturday, June 27th, 2009

For the all grain brewer, brew house efficiency is of great importance. Brew house efficiency will directly affect your recipe formulation and how many pounds of malt will be required to reach a specific OG at a specific volume in the fermentor. This is a brief explanation of brew house efficiency.

Brew house efficiency is the calculation of the overall efficiency of your brewing system. It takes into consideration the percent of potential grain sugars that are converted in the mash, effectively washed during the latuer and all wort losses in your system. If you do not accurately calculate the brew house efficiency of your brewing system you will find it very difficult, of not impossible, to anticipate the OG of the recipes that you are brewing. Here are some helpful equations to calculate efficiency in your brewing system: The following equations assume 10 pounds of 2-row pale malt in 5 gallons of water, with a mash/lauter efficiency of 75%.

Calculating Extract Potential:

((grain points)*(pounds of grain)) / (volume in gallons) = extract potential
((36)*(10)) / 5 = 72 or 1.072

Calculating recipe OG:

(potential points) * (brew house eff.) = OG
(72) * .(75) 75% = 54 or 1.054

Calculating Efficiency:

(measured points) / (potential points) = efficiency
(54 or 1.054) / (72 or 1.072) = 75%

Calculating Brew house Efficiency:

(Measured Points * Actual volume) / (Potential Points * Target Volume) = Brew house Efficiency
((54) * (4.5 gallons)) / ((72) * (5.0 gallons)) = 67.5%

Each pound of grain has an extract potential per gallon of water. Typical 2-row pale malt has a potential of 36 points, or 1.036, per gallon of water. Theoretically, if you achieved 100% mash and lauter efficiency (which is impossible) you could use 10 pounds of 2-row pale malt in a 5 gallon batch of beer and achieve an OG of 1.072. Most brewers are accustomed to achieving 75% efficiency during a typical mash and lauter, which would translate into 72 potential points * .75 (75%) = 54 points, or an OG of 1.054 with a volume of 5 gallons. But…..

The above can be considered mash efficiency (mash/lauter efficiency) since it does NOT take into consideration system losses of wort. Typically this is a loss that is created in the boil kettle and is lost to hops, trub or dead space in the boil kettle. In our example, if you end up with 5 gallons of wort in the boil kettle at an OG of 1.072, you have a mash efficiency of 100%, but if you transfer this wort to the fermentor and leave .5 gallons behind due to hops, trub and dead space you have now effectively reduced your system efficiency, your brew house efficiency to 90%. This would be calculated as such.

(Measured Points (72) * Actual volume (4.5 gallons)) / (Potential Points (72) * Target Volume (5.0 gallons) = Brew house Efficiency (90%)

In our same example, if you realized a typical mash/lauter efficiency of 75%, or an OG of 1.054 at a volume of 5.0 gallons in the boil kettle and 4.5 gallons to the fermentor after hop, trub and dead space losses, your brew house efficiency would look like this:

(Measured Points (54) * Actual volume (4.5 gallons)) / (Potential Points (72) * Target Volume (5.0 gallons) = Brew house Efficiency (67.5%)

So as you can see, mash/lauter efficiency is basically your efficiency into the boil kettle, but brew house efficiency is the efficiency throughout your brewing system which takes into consideration exactly what gravity and VOLUME you get into your fermentor. Understanding this calculation and the brew house efficiency of your brewing system will allow you to achieve a precise OG and volume into your fermentor each time, resulting in repeatability.

If all this math just gave you a headache, check out the brewhouse efficiency calculator found at this site.



Money Saving Tips – Repitching Yeast

Wednesday, November 26th, 2008

Update 11/12/2011: Check out the article on Bad Batches to see why you might want to avoid re-pitching yeast, or if you do so, make sure to understand the risks involved.

Did you know you can save ~10% on your next batch of home brew by re-pitching yeast? Some brewers buy new yeast for each batch. That is a good way to guarantee results provided the yeast is within the expiration date and has been refrigerated properly. However, at $7 a hit that comprises about 20% of the cost of the batch! With a little planning in terms of recipes and beer styles you can easily cut this in half or a third. It is a normal thing to do. The commercial breweries reduce their costs by repitching over and over.

Harvesting the yeast cake at the bottom of a finished primary fermentation vessel is easy. After siphoning off the beer into the secondary or bottling bucket the yeast will be left behind. Pour the yeast slurry (also called the yeast cake) into a sanitized container for safe keeping. You may need to loosen it up with some clean water. The yeast can be saved for several weeks in the fridge. It can be siphoned into regular 12oz bottles and capped, or put in a jar with an airlock.

The yeast can also be repitched immediately if you rack or bottle your old batch while you are cooling your new batch.

Do not repitch yeast that came from a contaminated batch, or had a weak or incomplete fermentation. Any yeast that had a healthy fermentation will work for this technique and it can be repeated many times. The maximum I have heard is ten times. That is getting up there and would limit choices of beer styles. Yeast can be a big factor in flavor and body. See a complete list of yeast strains by clicking here.

 



Money Saving Tips – Hops Utilization Factor

Sunday, November 2nd, 2008

Minimizing costs and maximizing beer is a wonderful thing to put into practice. This post discusses the idea of getting more bittering potential from hops. With hops going for $32/pound this is worth paying attention to.

Alpha acids in hops are isomerized into bitter flavors during the boil.  The utilization factor is a number that expresses how easily and completely this process takes place.  Higher utilization translates into a higher amount of international bittering units (IBUs). The utilization factor decreases as the boil gravity increases. This means the more sugary your wort is, the less bittering you will get per ounce of hops.   Therefore by lowering the gravity of the boil it is possible to stretch hops bittering quality.

This tip really only applies to extract brewers who are able to add fermentable sugars in a more flexible manner than all-grain brewers who need a full wort boil. All grain brewers do not suffer from such setbacks in hops utilization because their wort boil gravity is essentially what the original gravity of the recipe is. Most extract books say to add all the dry/liquid malt extract at the start of the boil to 3 gallons of water, then dilute to five gallons afterwards. This hurts the hops bittering potential!

The basic procedure to get your wort gravity down is to use half of your extract for the entire boil at the time the bittering hops are added.  With 15 minutes to go (usually after 45 minutes of boiling), add the rest of the extract to bring up the gravity to where the recipe calls for. This will sanitize the extract and sufficiently integrate it into the wort before cooling.

You can see this in action by playing with this website’s IBU calculator.

Let’s consider an example: a simple lager with 2 oz of Hallertauer hops, Alpha Acid rating of 3.9, boiled for 60 minutes, no other hops additions.

In the case of an extract batch with an original gravity of 1.055 for a 5 gallon batch, but only boiling 3 gallons, we get 18.53 IBU’s.

If we tell the calculator the boil gravity was only 1.028 (half the sugars), we get an IBU rating of 27!  For calculation purposes we get close to what we would see with a full wort boil (enter 5 gallons for boil size and 1.055 for gravity) and it comes out to around 25.

A 38% increase in hops bittering potential is pretty good. That translates into a 38% savings in the cost of our bittering hops. It also means more bitter beer which a lot of home brewers really like – including the author!

Note: this practice may throw off the style of beer your batch fits into by boosting bitterness beyond where it needs to be. It will also allow you to make your next IPA much more bitter for the money.  IPAs are particularly expensive to make these days because they call for 2x-3x hops, and about half of that is for bittering.



Cost Breakdown of Beer, Home Brewing vs. Commercial

Sunday, August 31st, 2008

The relative cost of commercial beer to the consumer is 70% marketing, packaging, and taxes! It is all because of the hefty price of marketing and packaging that home brewers have a substantial economic edge over large scale breweries. Comparing the breakdown to what home brewers pay for the relative ingredients tells us home brewers are paying a lot more for hops and malt. That makes sense due to the buying power large breweries have. Even so, home brewers easily beat the price of store bought beer. Quality is also easy to surpass after the fist few batches.

Large Scale Breweries:

Factor in Price Percentage Weight
Packaging 28.00%
Tax 25.00%
Sales and Marketing 17.00%
Production 15.00%
Malt 8.00%
Minor Ingredients 4.00%
Adjuncts 2.00%
Hops 1.00%
Total: 100.00%

Commerical Brewing Price Breakdown

Data Source: Beer: Tap Into the Art and Science of Brewing, by Charles Bamforth, 2nd Edition, Page 191

Home Brewing Relative Costs:

This is a basic 5 gallon batch of beer, OG of 1.05. Let’s assume we need 5.5 lb of DME (or 10-12 lb of grain) 4 oz of loose hops, gypsum/irish moss, fresh liquid yeast, 50 bottle caps and some cleaning solution.

Factor in Price Percentage Weight
Malt (5.5 lb DME, or 12 lb grain) 48.00% $18.00
Hops (4 oz) 21.33% $8.00
Yeast 18.67% $7.00
Packaging (caps/crowns, priming sugar) 6.67% $2.50
Adjuncts (Gypsum, irish moss) 2.67% $1.00
Production (cleaner) 2.67% $1.00
Tax 0.00% NA
Sales and Marketing 0.00% NA
Total: 100.00% $37.50

Commerical Brewing Price Breakdown

Closing Thoughts:

The time factor of home brewing is not considered, since home brewing is a hobby and something to be enjoyed. In other words, this hobby pays for itself. Check out the break even cost article for more details on that:
https://www.brewersfriend.com/2008/06/07/break-even-cost-of-home-brewing/



Per Batch Miscellaneous Item Costs

Sunday, July 27th, 2008

When calculating the cost of a batch of beer, it is easy to overlook the little items like sanitizer, bottle caps, clarifier, priming sugar, and specialty items like burton/gypsum salts or Irish moss. For those of us who keg our beer, don’t forget we have to pay for CO2 recharges every couple of years. For the time being most places in North America can take clean fresh water for granted, though some people do prefer to brew with spring water. No matter what, home brewing is STILL cheaper than store bought beer, because there is no marketing, packaging, labor, or transportation costs to deal with. Even if home brew was more expensive, it still tastes better and is more satisfying to drink.

Item Desc Cost/Batch
StarSan Santizier Use approximately 1 ounce (30 ml) per batch $0.95
Bottle Caps Estimate 50 (max) at $0.02/cap $1.00
Misc Ingredients
Burton Salts For English Ales, 1 ounce $0.20
Irish Moss Use ½ tsp per batch $0.20
Gelatin Use 1 tsp per batch $0.25
Priming Sugar – Corn Syrup 6 oz per 5 gallons $0.40
Priming Sugar – Light DME 8 oz per 5 gallons $1.75
Kegging
CO2 If you are kegging a 5 gallon batch $1.00
Line Cleaner $0.25
Kegging
Water? If store bought spring water used in beer (5 gal) $5.00
Carbon Filter wear and tear on filter $1.00


Break Even Cost of Home Brewing

Saturday, June 7th, 2008

The economics of home brewing are almost as pleasing as drinking the final product.

If you just want to make ales, you can break even after only four batches. Some starter kits are so cheap, you can break even after less, but the more ‘tools’ the more fun and the easier the job becomes. For a full kegging, lagering, and all-grain setup, it can take up to 34 batches to re-coup equipment costs, but that is fairly high estimate. Over a lifetime of 50 years of brewing, one thousand batches are within reach, and most of the equipment doesn’t wear out ever (like glass carboys and pots).

The underlying assumptions used:

Your average cost per batch is $40, you brew 15 times a year, and if you had to buy store bought beer *shudder* you would get a mix of micro, USA craft, and Euro import beer. Each batch you brew pays you profits, which add up and quickly overtake your equipment investment. You will feel this after looking over the results your first bottling session. Your next trip to the grocery store will be lighter because you made your own beer.

Average Cost Per 5 gallon batch $40.00
Average Price of 5 gal, retail $100.00
Savings / batch (profit) $60.00
Batches / Year 15
Minimum Setup Costs: $225.00
Batches to Recoup Cost: 3.75
Time to recoup (months): 3

Basic equipment only.

Setup Costs for lagers, kegs, fridge, capacity: $1,500.00
Batches to Recoup Cost: 25
Time to recoup (years): 1.67

The extra cost here translates into more flexibility, less bottling time, and the ability to make lagers and drink draft beer at home.

Full setup for all grain, 10 gallon batches $2,000.00
Batches to Recoup Cost: 33.33
Time to recoup (years): 2.22

All grain beer is better quality, and 10 gallon batches are 2x time efficient.

break even analysis



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