Popular brewery to shut after 36 years

The “tough times” continue for the industry with even one of the world’s biggest producers not able to make it work.

A brewery, best known for producing the popular James Squire range of beers, is set to be closed down as the cost of living crisis bites and the beer drinking market shrinks.

Popular Sydney outfit Malt Shovel Brewery will be shuttered at the end of August, impacting nine staff members.

Its comes at a torrid time for the craft brewery industry with a spate of closures hitting the sector as onerous taxes and a massive drop in demand drives breweries to their knees across the country.

Malt Shovel Brewery was first established by Chuck Hahn in 1988 and was sold in 1993 to Lion Nathan – one of the largest drinks groups in the world which is best known for making XXXX Gold and Tooheys.

Brew Master Chuck Hahn established the brewery in 1988. Picture: News Regional Media

Lion Australia managing director James Brindley said the company had informed team members of the “difficult decision” to close the brewery in just under three months.

“It’s been a tough time for all players in the Australian beer industry – with overall volumes declining by 100 million litres since 2019, continuing a long-term decline in consumption of beer,” he said.

“There have also been ongoing cost of living pressures reducing discretionary spending, and continuing increases in costs like energy, labour and ingredients, as well as government excise, which is now the third-highest in the world.”

Malt Shovel Brewery, which is based in the inner Sydney suburb of Camperdown, had played a pivotal role in pioneering the craft beer movement in Australia – introducing consumers to a diverse range of beer styles, including pale ales, porters and stouts, Mr Brindley added.

“It is now best known for the James Squire range, but was also the birthplace of Hahn,” he noted.

A worker at Lion Nathan's Malt Shovel Brewery at Camperdown in Sydney back in 2004. Picture: News Corp

Currently Malt Shovel is producing a range of James Squire, Eumundi, New Belgium and Little Creatures products which will be transferred to other sites in their breweries in the Lion network including in northern NSW and Geelong in Victoria.

Malt Shovel head brewer Allison Macdonald said she was “incredibly sad” about the closure but was proud of the brewery’s legacy which had an “incredible history and lineage of beers and brewers throughout the years which I’ve been proud to have been part of”.

Malt Shovel head brewer Allison MacDonald, and Lion managing director James Brindlay. Picture: Supplied

News.com.au had previously revealed an industry insider sounding the alarm about the difficulties the industry faced.

Nick Boots, an industry consultant from The Business of Beer Consulting and Advisory and previously the general manager of popular Byron Bay brewery Stone & Wood, warned that the recent collapse of Melbourne-based Deeds Brewery wouldn’t be the last to rock the sector.

Now Malt Shovel is added to the growing pile, while Asahi, Australia’s biggest beer company, announced just last month it was also closing one of its craft beer operations Matilda Bay Brewpub in Victoria due to rising costs including wages, energy bills, materials and taxes.

A number of other independent breweries have gone into administration in the past year including Brisbane-based Ballistic Beer Company, Adelaide business Big Shed Brewing, Melbourne-based Hawkers Brewery and the Wayward brand and Akasha Brewery, both from Sydney.

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Originally published as Popular brewery to shut after 36 years