Bitter end is nigh for Tetley's

The writing has been on the wall for Tetley for years. The group was first known as Carlsberg-Tetley, but the Danish owners showed their intentions when they renamed the British subsidiary Carlsberg UK. Hello lager, goodbye ale.

It's a tragedy. Around 170 people will lose their jobs and Leeds will lose an iconic brewery founded 186 years ago. Tetley's Bitter in cask form is — should I say was? — a superb beer. I remember drinking it for the first time in a pub in Bradford and marvelling at the hoppy bitterness of the beer. It didn't travel well, you had to catch it right, preferably in Yorkshire, but on a good day it was a great pint.

Carlsberg pressed the usual buttons when it made the announcement: tough times for brewers, the smoking ban and the increase in beer duty this year. But even before the announcement, the brewery had decommissioned the famous "Yorkshire squares", the vessels used to make the cask version of the bitter. The closure had been long planned.

And it was no secret that Leeds council had been in talks with Carlsberg about the need to close the city-centre site and move elsewhere to make room for new housing.

So the closure of Tetley was a long time coming. The reasons go beyond those stated by the company. The truth is that Carlsberg has little interest in ale and has done nothing to promote the beers brewed in Leeds.

The problem is compounded by the economics of the mad house that afflicts global brewers. A few days before the Tetley announcement, Coors declared the most appalling, catastrophic fall in its profits. The group, which runs the former Bass and Allied plants in Burton-on-Trent, reported pre-tax profits down 78% in 2007. In 2006, profits were £68m, last year they were £14.75m.

Last week, piling misery on gloom, InBev reported that sales of its leading brands, Beck's and Stella Artois, were down by 5.3%. You would think, reading all these dismal reports, that no one was drinking beer any more.

But one report got little coverage. The Society of Independent Brewers (Siba) announced that in the first six months of 2008 its 430 members had reported sales of beer were up by an average of 8%. It's worth repeating that: beer sales were up 8%.

Siba started life as the umbrella organisation for Britain's microbrewers. Many were tiny, producing just a few casks a week. But today Siba is a formidable and well-run body. Its sustained lobbying won progressive beer duty for smaller brewers. Today it is a power in the industry and includes not only minnows, but such bigger fish as Fuller's, Marston's and Shepherd Neame.

Ale on the up​

Why is it that Siba members are doing well and brewing more beer while the global producers are in crisis, closing plants and with profits in free fall?

One reason is life style: more and more people are shunning global brands. Where beer is concerned, drinkers want local beers made, as far as possible, from local ingredients. They are wary of mass produced brands brewed under licence thousands of miles from their places or origin, often with ingredients flown half way around the world.

Discriminating drinkers are green drinkers. They take a keen interest in how and where their beers are brewed. They expect producers to share their concern for the environment. Many brewers have responded. Ranging in size from Shepherd Neame, through Adnams to the small Otter Brewery in Devon, producers are designing their sites and vessels to trap steam and carbon dioxide to avoid damage to the environment.

Last month, Greene King unveiled a new bottle range using packages weighing 25% less than older styles. As it's the biggest brewer in the take-home sector, producing 18 million bottles a year, it is a significant contribution to the campaign to combat global warming. Its trucks, restricted to 52mph, have tyres that last longer as they are filled with nitrogen, which is lost more slowly than air.

The second reason for the plight of the global brewers is that they are in hock to the supermarkets. It doesn't take a genius to work out that if Coors sells beer at little more than cost to the multiples, then its profits will go into free fall. The globals signed their own death warrant when they agreed to play the discount game.

Wherever Tetley's Bitter ends up — possibly John Smith's or Burtonwood — the great Leeds beer will probably disappear within a few years.

If the brewing giants are to survive, then they must learn the lessons of the 21st century. Drinkers want beer with flavour, made with fresh, local ingredients, and not trunked around the country.

Siba proves there is a bright future for quality beer, but it may be too late for the globals to jump on the dray.