Thursday, November 15, 2007

Cheapest Batch

This is a geeky-fun post detailing the cost of 3 methods for producing 5 gallons of home brewed beer. In this demonstration, by "simple beer," I mean a beer that falls between the Mild Ales, and the more expensive hoppy beers like pale ales/IPA or higher gravity beers. A simple beer to me is a mildly hopped Scottish, Irish Red Ale, Dry Stout, etc. For this analysis, I use a beer with an OG of 1.040. The cost of yeast, hops and bottle caps is constant at $10, and an 8% sales tax is included in all calculations.

A. Extract Based
After assembling a basic brew kit, home brewed beer is already cheaper than buying quality commercial beer. At its very basic and introductory level, malt extracts are used for the bulk of fermentables. Specialty grains and hops will provide distinctive color and enticing flavors and aromas. This method of brewing a simple beer can cost s around $26.50 ($2.95/6-pack).

B. All-Grain (pre-crushed)
After building onto the basic system, to allow for an all-grain procedure, the cost per batch goes down a little bit. The easiest way to get started with ingredients is to purchase "pre-crushed" grains. The overall efficiency of a mash with pre-crushed grains can be quite low, so more malt is required to obtain the correct gravity. I've experienced efficiencies in the range of 60-70%. Also, having malts crushed for you adds about 10-20¢/pound. But at this point a batch of simple beer costs less, at around $24.12 (/6-pack).

C. All-Grain (whole kernel)
Ordering whole grain malts simply costs less (about $1.31/batch). Yeah...it takes a little while to hand crush the grains, but it's much fresher, and a much better crush. Using my LHBS mill, I've recorded efficiencies as high as 78%. An adjustable mill is preferable. After crushing at home with a new Barley Crusher, I've hit an all new high of 85%! Going from 62% to 78%, reduces the malt poundage by 1.7lbs/20%, and cuts about $2.72. Going from 62% to 85%, reduces malt poundage by 2.25lbs/26%, and cuts about $3.60. So with a home-crushed, whole-kernel, all-grain method, a batch of simple beer costs around $20.60 ($2.32/6-pack).

Further Reductions

1. Knock off $6 by reusing yeast
2. Swing top bottles cancel the need for bottle caps (about $1.16/batch)
3. Buying lower quality domestic base malts at $1.15/lb. ($2.27/batch)
4. Buying in bulk with flat rate shipping (marginal savings)

After applying these reductions...

Method A...$17.07 ($1.92/6-pack)
Method B...$14.69 ($1.65/6-pack)
Method C...$11.17 ($1.26/6-pack)

At an annual production of 12 batches/year (60 gal/106 6-packs), on average, each method would cost...

Method A...$261
Method B...$231
Method C...$190

In the end it, there are many ways to reduce the cost of brewing. At the same time, not only does the price go down, progressing from method A to C also greatly improves the quality of the beer.

With the current downward turn in the availability of quality/traditional barley and hops, and a serious increase in their price, we are inevitably facing challenging times. Decreasing the cost on the side of production, can help buffer the increased price of ingredients.

12 comments:

Travis said...

Maybe it's my LHBS, but I would differ with you on the price you came up with for the extract brews. Cans of LME around me are ~$13 per can. Most recipes call for two cans. If you were using DME, the cost is pretty substantial as well. From my experience it's $15lbs and $4per additional pound.

One thing I found interesting that we have talked about with our brew sessions is crushing our own grains. How many batches does it take for the equipment cost in that sort of purchase to start paying off? The grain mills I have seen are pretty expensive and it seems like I would have to be brewing a lot to make that one fly.

Adam said...

Travis, I see your point. The bags and cans of extract can get expensive.

Recently I've taken to buying bulk and/or house brand malt from places like Northern Brewer. They have traditional canned brands and house brands. The house brands range from the 3.15 lb package to the 33 lb bulk. If I use $10 as the cost for yeast, hops and caps as a constant and add in the cost of 5 lbs of LME, I get the following prices for a batch of beer.

$30.45 Munton's Light (3.3 lb price)
$24.57 NB (3.15 lb price)
$22.15 NB (6.00 lb price)
$20.63 NB (33.00 lb price)

Which translates to the following six pack prices.

$3.65 Munton's Light (3.3 lb can price)
$2.95 NB (@ 3.15 lb jug price)
$2.66 NB (@ 6.00 lb jug bottle price)
$2.48 NB (@ 33.00 lb jerrycan price)

Includes an 8% tax. Doesn't include the 7.99 shipping either. Sheesh...lotsa variables.

Of course my catalog shopping approach doesn't show as much support for the local homebrew shops. I use them like convenience stores since I'm so forgetful. If I really need something quick I get it from them.

About the current shortages. I do think that will have an impact on the homebrewers out there. For the most part they will continue to brew because they love it, but, the array of choices will be changed by what is available and reasonable. Who knows maybe we'll innovate in the face of shortages.

Adam said...

Oh yeah...I used 50 bottles per 5 gallon batch as the divisor when figuring the price per six pack.

Ted Danyluk said...

Thanks guys for your great feedback/info.

I haven't brewed an extract batch in a very long time. So to make that calculation simple, I was using the Irish Red Ale Liquid Extract Kit from NB, and then adding the sales tax onto that.

Travis,

There seems to be a lot of choices (price ranges) for extract. If 2 cans are needed, and they run for $13, then the total cost would be close to $36!

If a grain mill cost about $150, and with approx $2 savings per batch, then it would take about 75 batches to break even. But, from the looks of it, it seems like you will be brewing for a very long time. And, it makes the beer come out much fresher (much like brewing coffee). Lastly, I usually consider the occasional equipment upgrade as a trip to an amusement park...it just makes brewing so much more enjoyable.

Adam,

Did your math include specialty grains? The cost of additional steeped grains would be around 1.60-3.00.

I admit I'm quite biased, but I don't believe a good batch of beer can be made from extract alone. Here, I'm trying to keep the quality of each batch as close as possible.

Taking in account the lower end and the upper end of malt extract recipes, do you guys feel like my average of $26 is fair? Also, the all-grain base malt was based on a $1.50/lb, not the $1.15/lb.

Perhaps I should write another post called... "Absolute Cheapest Batch." But I suppose Method C w/further reductions is the absolute cheapest...

$11.17/5gal
$1.26/6-pack
$0.21/bottle

Adam said...

Quick replies for now...

No, I didn't include steeping grains. Your right. Gotta add that in there.

I think you can make an average beer with just extract. Extract only Belgian style beer turns out pretty well due to the flavors that the yeast imparts. Of course the steeping grains really do take it to the next level.

Not sure if $26 is really a good price point. There are so many factors to take into consideration. Maybe another post for us to consider would be titled. What does it "typically" cost to brew an above average beer? That would serve to set expectations properly when walking into a homebrew store.

Anyway...ran out of time. Gotta go and check my Thanksgiving English Style Session Beer that probably cost me less than $26 with specialty grains and shipping.

Ted Danyluk said...

Adam,

When I think of a Belgian beer, I typically think of a stronger than average one...say around 6.5-11%. So an extract version would definitely cost more.

It's true that there are a lot of variables and options when brewing in any method. I was trying to keep the comparison of 3 methods at that "above average" level. And keeping it at a modest gravity of 1.040.

Are you getting 5 gallons in the end?

Travis,

Lets say you reused your yeast the majority of the time, and used the cheapest base malts (in other words Method C at $11.17/batch), you'd break even with a $150 grain mill after only 12 batches! But since you brew 10 gallons at a time, then only 6 batches for you! After that, you are free to brew what ever you want!

Adam said...

Good conversation going on here :-)

True Belgian styles are typically higher abv for me and wouldn't fall into this price range.

Hmmm...am I getting 5 gallons. Not consistently. I just had to pick number and I thought 50 was conservative with sediment and trub.

Don't get me wrong. I certainly appreciate the exercise you went through for the above average beer and doing so with three different brewing methods. Well done! I guess what I'm saying is that it gave another idea that I could blog about. :-) What would it typically cost to brew a beer when buying at a LHBS.

Now, off to pour a ping of homebrew!

Prost!

Travis said...

Ted,

I just got back from a trip to my LHBS and the hop shortage is happening and it's hitting homebrewers!

I openend the fridge and it was almost empty. when I asked if he was waiting for a shopment to come in, he said he just got one. He ordered 800oz of hops and got like 100oz. Cost wise it's going to double our hops costs, but shortages are going to be where it really hits home.

To top things off, there ar rumors that these shortages are only in anticipation of shortages to come next year. As brewers, we are all going to have to get REALLY good at growing hops REALLY fast.

Cheers.

Adam said...

Whoah! Well I Bryan and I have some Cascade plants that are doing well. My other plants are getting transplanted to better sunlight.

Remember the first year's yield is pretty small. Even if you plant something next spring, don't expect much.

Northern Brewer said something like this year's harvest hasn't come in yet and that is why they are short. Check out their hops page.

Ted Danyluk said...

Thank you for all your great comments. This has been a fun conversation.

This post could easily be a record of history, marking the cheapest batch prior to the Hop Crash of 2007!

Here in Chi-town, about a month ago, my LHBS placed restrictions on the quantity of popular/diminishing hops (Cascade, Centennial, etc.). The prices were the same, but I wonder if they've stayed that way?

Still, the type of beer this example of the "cheapest batch," is one with very little bittering hops. And these types of beers will still be very affordable.

I'm glad I order a whole bunch of hops to get me through the winter lagering season, and into the beginning of springtime ales.

Lets all write a post about our own take of this hop topic, and we can each include a round-up of each other's hop post. Or you can send me a link to your post and I'll round them up on mine. (redted8 at yahoo . com)

Adam said...

Will do! I'm a bit under the weather right now so it may be a few days before I get to it.

Cheers!

Travis said...

Sounds good!