Craft Beer Market Faces Volume Decline in 2025
The beer industry is experiencing notable shifts in consumption patterns so far in 2025. Overall, craft beer production volumes have declined by approximately 5%, with shipments falling by nearly 6%, translating to a loss of around 3.7 million barrels. The number of active breweries has also slightly decreased in the United States, signaling challenges within the sector.
Retail data further confirms this contraction: in grocery and convenience stores, craft beer dollar sales have dropped 6.3%, with volumes decreasing 7.2% in the past month alone. Distributor demand has waned as well, highlighted by the Beer Purchasers’ Index for craft plummeting to 15, far below the neutral 50 mark that indicates growth (American Craft Beer, 2025).
Changing Consumer Preferences Drive Market Evolution
Industry experts attribute these declines not to diminishing interest in beer per se, but rather to consumers’ evolving drinking habits and expanding preferences. Younger demographics are increasingly sampling diverse beverage categories beyond traditional beers, including Mexican lagers, non-alcoholic IPAs, and ready-to-drink cocktails. In contrast, older consumers are moderating alcohol intake due to health and budget considerations.
Remarkably, non-alcoholic beer has become a standout growth segment, seeing sales rise by nearly 30%, adding $91 million in value, and capturing a full 1% share of the beer market for the first time. This surge aligns with broader wellness trends and health consciousness among consumers (American Craft Beer, 2025; IMARC Group, 2025).
On-Premise Consumption and Premiumization Maintain Strength
Despite off-trade challenges, on-premise venues such as taprooms and brewpubs have shown resilience. Recent reports indicate that these onsite models are outperforming distribution models by 1-2% in volume during the first half of 2025. High visitation rates to bars and restaurants, combined with consumer interest in premium and health-conscious options, support a tilt toward quality and experience in drinking occasions.
About 20% of consumers plan to pursue higher-quality food and beverage experiences in 2025, while roughly a third intend to adopt healthier consumption habits, boosting demand for lower-alcohol and non-alcoholic craft beer options. Meanwhile, value remains important, with around half of on-premise patrons focusing on good value for money, suggesting a nuanced balancing of quality and cost in buying decisions (CGA by NIQ, 2025).
Market Growth Outlook and Innovation Trends
Longer-term forecasts remain optimistic for craft beer’s growth potential. The global craft beer market is projected to grow at a compound annual growth rate of approximately 8.7% through 2033, driven largely by expanding numbers of microbreweries and brewpubs worldwide. These smaller-scale establishments facilitate experimentation and innovation, deepening consumer engagement with craft beer culture.
Innovations such as cold IPAs using lager yeast and hybrids expanding flavor profiles continue to gain traction. Sustainable brewing practices are also emerging, although progress varies by region. The rise of non-alcoholic and low-alcohol segments, in particular, represents a key area of opportunity to meet increasing health and wellness expectations among drinkers (IMARC Group, 2025; Escarpment Labs, 2025).
Competitive Landscape and Challenges Ahead
Nevertheless, the market faces increased competition not only from alternative beverage categories such as cannabis products but also within the crowded beer segment itself. Retail shelf space is limited, and consumer brand loyalty is weaker than in previous years, demanding sharper marketing and innovation strategies. The beer industry can no longer assume dominance in social and recreational settings, necessitating adaptation to new consumer mindsets and evolving lifestyle trends (Hop Culture, 2025; American Craft Beer, 2025).