Anchor Brewing: America's oldest craft brewery shuts after 127 years

A beer-maker founded in San Francisco in 1896 that promotes itself as America's "first" craft brewer is closing its doors.

Anchor Brewing Company said it would cease operations and liquidate the business, pointing to years of falling sales.

Japanese brewing giant Sapporo, which purchased Anchor in 2017, said efforts to revive the brand had failed.

It had been dubbed a "godfather" of America's craft beer renaissance.

"This was an extremely difficult decision," Anchor Brewing spokesman Sam Singer said.

"We recognise the importance and historic significance of Anchor to San Francisco and to the craft brewing industry, but the impacts of the pandemic, inflation, especially in San Francisco, and a highly competitive market, left the company with no option but to make this sad decision to cease operations," he said.

America was once dominated by brewing giants such as Miller and Anheuser-Busch. But the number of independent beer-makers has exploded since the 1980s.

Anchor, with its roots in the Gold Rush, was a pioneer of that trend, raising its profile beyond San Francisco in the 1970s and 1980s, with backing from an heir to the Maytag appliance fortune and an appearance with Arnold Schwarzenegger in television drama "The Streets of San Francisco".

In a profile of the company in 2017, the food website Eater reported that it was known for offering a "bubbly, malty, kind of bittersweet alternative to the watery pilsners" that had long dominated the market.

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That flavour was rooted in the steam style of brewing, which Eater cast as one of the few native to the US.

But the brand, which made many of its sales to bars and restaurants, has struggled more recently.

It did $10m in turnover last year, down from $12m the prior year, according to Sapporo, which purchased the company for $85m in 2017 in a bid to expand its presence in the US beer market.

Sapporo said it had tried to revive sales by renewing products and making other investments but could not overcome the hit to the business from the pandemic.

An Anchor Steam worker bottles beer in 1978

"Anchor was significantly affected by the impact of the novel coronavirus, and such impact was particularly prolonged in the San Francisco area. As a result, Anchor's sales have significantly decreased," Sapporo said, warning investors that it would take a Y6bn ($43m) hit from the decision.

Craft beers accounted for just over 13% of the beers sold in the US last year and roughly a quarter of sales by value, according to the Brewers Association.

But the beer industry has been under pressure, as pre-packaged cocktails gain popularity.

The number of beers sold in the US last year sank 3%, the Breweries Association said. At small, independent brewers, sales volume was roughly flat.

Anchor, which gave 60 days notice to its roughly 60 staff, said it had repeatedly tried to find a buyer in recent years and still hoped one would step forward during the liquidation process.

It said it had stopped producing beer but would continue packaging and distributing its bottles in California until the end of July. Its local pub will also remain open temporarily to sell remaining inventory.