Australian craft breweries are facing financial challenges, with several entering administration due to a combination of factors, including pandemic-related debts, excise tax, and rising costs. The economic downturn, coupled with increased production costs and higher interest rates, has left many small and mid-sized breweries struggling to stay afloat. The Independent Brewers Association reports that 91% of its surveyed members have been severely affected by the current economic climate, with 66% expressing doubt about their businesses surviving the downturn.
Some breweries are responding to the challenging environment by forming cooperatives, such as the Local Drinks Cooperative founded by Wayward Brewing and Batch Brewing. Despite the difficulties, some breweries, like Bad Shepherd Brewing, are focused on community investment and resilience. While the industry is currently experiencing a recession, analysts expect conditions to improve in the future as inflationary pressure cools, supporting a recovery in demand for craft beer.
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