The closure of a historic Tasmanian brewery has sent shockwaves through the Australian beer industry, with many pointing to the escalating costs of brewing as a significant factor. James Boag, a name synonymous with Tasmanian brewing for 145 years, announced it would cease production at its Launceston facility in November. The brewery, which prided itself on using “the pure waters of Tasmania,” will see its operations shifted interstate by its parent company, Lion Australia.
A Devastating Blow for Launceston
The announcement has been met with dismay by local industry figures. Sam Reid, owner of the Du Cane Brewery in Launceston, expressed his shock, particularly given recent state funding allocated to the James Boag facility. “We feel for the staff who have lost their roles there,” Mr. Reid stated. “It’s terrible for Launceston, terrible for the staff and their families. I thought they were going to be staying focused and committed to Launceston for a while.”
Mr. Reid suggested that the decision was less about the cost of brewing in Launceston itself and more about the operational efficiencies gained from Lion’s larger production hub in Lidcombe, Sydney. “It’s probably starting to outweigh the benefits of making beer here in Launceston,” he observed.
The Launceston brewery had received $1 million in state funding in 2023 to keep its visitor centre operational. Lion Australia has indicated this funding will need to be repaid. Premier Jeremy Rockliff had previously highlighted the visitor centre’s role in promoting local businesses and attracting tourists. Mr. Reid voiced a hope that this funding could be reallocated to support other local breweries, especially with the arrival of new Spirit of Tasmania ferries. “There’s really a great opportunity to invest in the tourism and visitor economy side,” he remarked. “Some of that million dollars could hopefully be used to continue to invest in the visitor economy.”
Disappointment Among Drinkers
The news has also been a bitter pill for long-time Boag’s drinkers. Leigh Sherriff, who has enjoyed the brand for approximately 70 years, described the closure as “disgusting,” asserting that Boag’s beer was “as good as any of the beers from the mainland.” Craig Barron echoed these sentiments, calling the company’s departure “not good” and a blow to the local economy and employment. “It’s an institution, it’ll put people out of work. I can’t believe it, to be honest.”
The Rising Cost of Brewing and its Impact
Sabrina Kunz, chief executive of the Independent Brewers Association, believes the James Boag closure is symptomatic of a broader trend of increasing brewing costs in Australia. “For a company the size of Lion, [Boag’s] would have been one of their smallest production facilities and they have the opportunity to keep the brand of Boag’s going by presumably transferring to one of their larger production facilities,” Ms. Kunz explained.
She highlighted the alarming rate at which breweries are shutting down across the country. “Our breweries are simply closing down, we’ve lost something like 80 breweries over the last two years nationally.”
Ms. Kunz has urged the federal government to review alcohol tax regulations, particularly the excise tax on beer, which she argues is disproportionately higher than that on wine. “Aussies want to be able to shout a round at the pub, they want to be able to host their neighbours for a barbecue and the excise tax regime is making it such that it’s simply unaffordable,” she stated. “We have been saying for years that the cost of a pint made by a local Australian brewery is becoming unaffordable.” The federal government has been approached for comment on this matter.
Owen Johnston, chief executive of Hops Products Australia, described the situation as “a terribly sad day for the history of Tassie beer.” He pointed to significant structural issues within the industry. “Beer volumes peaked in Australia back in the 70s, so you can say for forty years or more we’ve had declining beer volumes,” Mr. Johnston noted. “The capacity in the network of breweries around the country, especially with the big brewers, has always been in excess.”
A Rival Brews On
In contrast to the news from James Boag, Asahi Beverages, the owner of Tasmania’s historic Cascade brewery, has reaffirmed its commitment to the state. A spokesperson for Asahi stated, “Asahi Beverages, the owner of Cascade, is committed to the future of the iconic brewery — Australia’s oldest brewery.”
The company announced a significant investment of $13 million for a capital upgrade of Cascade’s brewing and cider equipment. “It’s the biggest investment in the site for more than a decade and ensures Cascade continues to brew beer in Tasmania for Tasmanians for years to come,” the spokesperson added. This commitment stands in stark contrast to the looming closure of James Boag, underscoring the varied fortunes of the beer industry in Tasmania.
