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TheStreet Open House

How the Craft Brew Alliance's Joe Casey Is Hopping Up Cider

Stocks in this article: BREW

PORTLAND, Ore. ( TheStreet) -- As the rest of America marvels at the growth of hard cider, the Pacific Northwest wonders what took it so long.

Already boasting an outsized reputation for both craft beer and wine, the region and the states surrounding it have also developed a strong taste for hard cider. Cider producers such as Liberty, Wandering Aengus, Tieton, 2 Towns, Carlton Cyderworks are among the more than 30 members of the Northwest Cider Association that call the region home. That doesn't even include California cider works such as Ace that include the area in their broad distribution circles.

This week marks the annual Northwest Cider Week and invites a player to the table for the first time: The Craft Brew Alliance (BREW). The collective that includes Portland, Ore.-based Widmer Brothers and Woodinville, Wash.-based Redhook launched its Square Mile Cider Co. last month as its first foray into the region's already packed cider market. For those who doubt just how badly the Alliance wants a piece of cider profits, consider that it named its cider venture after the square-mile claims staked by settlers who arrived at the end of the Oregon Trail in the 1850s.

In the context of the current cider market, the Alliance's claim is potentially substantial. According to market research firm SymphonyIRI Group, hard cider sales at supermarkets and other stores hit about $90 million for the 12 months ending Oct. 30. That's up more than 65% from a year earlier and outpaces the 5.6% growth of wine and the 13% growth of the craft beer segment in 2011, as well the 1.7% growth overall beer sales last year. SymphonyIRI's research excludes sales at liquor stores and discount stores such as Wal-Mart (WMT), which may downplay cider's growth a bit, but small cider makers are being joined by big brewers who want a bite of the cider market.

Hard cider sales still get tossed into the overall beer market and account for 0.2% of of sales, according to a report by Nomura Research. It's a sixth of the 1.2% market share held by Samuel Adams brewer Boston Beer (SAM). Half of cider's consumer base is made up of women, compared with only 20% for beer. It also sells for an average of $35 a case, according to Nomura. That's well above the $29-a-case paid for imported beers and $33 brought in by craft beer.

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