The Mexican beer industry: the economy behind the craft

With the Spanish conquest, the production of beer was introduced in 1542 to the territory. Due to the high prices of producing the drink, the first Cerveceria lasted only 4 to 5 years. The following breweries in the country had one problem; the hops and barley needed to be imported. Consequently, the barley plantations became a necessity, and it was not until the mid-19th century that national production became industrialized. This industry benefited from the railway and maritime transport by solving the lack of raw material supply. In the 20th century the Mexican breweries, many we know today like Compañía Cervecera de Toluca y México S.A, Cervecería Cuauhtémoc (Monterrey), Cervecería Modelo (Mexico City), Cervecería del Pacífico (Mazatlán), etc…started rising (Secretaría de Agricultura y Desarrollo Rural, 2019) (Reyna & Krammer, 2012).

The Prohibition Era in 1920 in the United States, which banned the manufacture and sale of liquors, caused more breweries to be constituted in the northern frontier, becoming a tourist attraction for US citizens. This led to the acquisition and takeover of small enterprises from big companies like Cervecería Cuahtémoc-Moctezuma which took over Tecate and Cervecería Modelo (Grupo Modelo) that merged with Cervecera de Toluca y México S.A. These two big Mexican breweries dominated the market as independent companies.

Now, in the 21st century, the Mexican brewing industry has transformed, a situation where it is managed entirely by foreign conglomerates again. However, this provoked the return of small new breweries that keep the artisanal way of production and gradually positioned themselves in the national market, seeking to reach the global marketplace (Gobierno de México, 2021).

Even though the most important breweries are controlled by foreign companies, the beer industry and production in Mexico is among the 19 most important activities of manufacturing industries out of 288, according to an economic census of 2019.

Over the period 2013-2019, beer production grew at an average annual rate of 6.7%. In the months of April and May 2020 beer production had its worst moment, but June and July showed a rapid recovery to place production above the months before the start of the pandemic, data shows that this recovery is higher than the economy in general.

Since 2010, Mexico has positioned itself as the world’s leading exporter, surpassing major beer-exporting countries such as the Netherlands, Belgium, and Germany. Mexico exported $4.85 billion USD worth of beer in 2019 and imported $92 million USD, generating a trade surplus of $4.764 billion. The main country of exportation is the U.S. with 94.3% of exports, followed by China with 2.3% (INEGI, 2020).

According to INEGI figures (2020), the beer industry in Mexico has the highest average remuneration of the entire alcohol industry (34 900), followed by beverages of Agave (13 081) and alcoholic beverages based on grapes (12 090). The wages represent 55.7% of the total remunerations compared to salaries (33.9%).  Wages and salaries are two different components of the remunerations in the beer industry; thus, wages vary depending on the hours and days a person works, compared to a salary which is fixed and an agreed amount.

In recent years, the number of brewery economic units is increasing due to the emergence of micro, small, and medium enterprise producers, what is known to be the artisanal beer market. According to Forbes Mexico (2022), Mexican craft brewers are expected to produce more than 10% this year, surpassing the 30 million liters in 2021.

Despite being an incredible figure for the Mexican artisanal brewers, it is not compared to the national production, throwing 94.5 million hectoliters in just 8 months, a year-on-year growth of 5 percent (El Economista 2022). If we compare the numbers with other countries to illustrate the levels of competitiveness, in 2021 China was the leading producer with 359.74 million hectoliters of beer and the US brewed 203.57 million hectoliters (Conway, 2022).

As mentioned before, the historical context shows that barley is the most important element and the key ingredient for this industry. With the war situation in Ukraine, the activities of beer production were stopped in many countries, since Ukraine is one of the main barley producers worldwide. But this was not the case for Mexico, last year the barley plantations saw a historic production of over a million tons. The same dynamism is expected to continue in the first trimester of 2023, to continue the recovery of the pre-pandemic levels (Rodríguez, 2022).

It’s clear that this industry has a lot to offer, while being one of the most important economic activities that generate more than 900 thousand jobs in the country (Crónica 2022), it is also clear that the Mexicans appreciate and encourage its growth. Also, it demonstrates an excellent example of bilateral collaboration, working with a committed workforce and producers’ network with a strong love for their roots and culture.

Crónica. (2022). Industria cervecera genera mas de 900 mil empleos en Mexico. Retrieved from https://www.cronica.com.mx/negocios/industria-cervecera-genera-900-mil-empleos-mexico.html

El Economista. (November 9, 2022). ¡Salud! La producción de cerveza mexicana está en niveles récord. Retrieved from https://www.eleconomista.com.mx/empresas/Salud-La-produccion-de-cerveza-mexicana-esta-en-niveles-record-20221105-0009.html

Forbes Mexico. (October 22, 2022). La industria de cervezas artesanales crecerá 10% este 2022. Retrieved from https://www.forbes.com.mx/la-industria-de-cervezas-artesanales-crecera-10-este-2022/

Gobierno de Mexico. (October 29, 2021). El paso histórico de la industria cervecera en México. Retrieved from  https://www.gob.mx/agn/es/articulos/el-paso-historico-de-la-industria-cervecera-en-mexico?idiom=es

INEGI. (2020). Colección de estudios sectoriales y regionales: Conociendo la Industria de la Cerveza.

Jan Conway. (2022). Leading 10 countries in worldwide beer production in 2021. Retrieved from Statista: https://www.statista.com/statistics/270269/leading-10-countries-in-worldwide-beer-production/

Reyna, M. d., & Krammer, J.-P. (2012). Apuntes para la historia de la cerveza en México. Colección Etnología y Antropología Social.

Rodríguez, A. (November 1st, 2022). Industria cervecera está optimista: esperan recuperar nivel prepandemia en 2023. Retrieved from El Financiero: https://www.elfinanciero.com.mx/empresas/2022/11/01/industria-cervecera-esta-optimista-esperan-recuperar-nivel-prepandemia-en-2023/

Secretaría de Agricultura y Desarrollo Rural. (August 2, 2019). Producción de cerveza en México: una historia para celebrar. Retrieved from Gobierno de Mexico: https://www.gob.mx/agricultura/articulos/produccion-de-cerveza-en-mexico-una-historia-para-celebrar?idiom=es