The Great Keg Beer Rip Off?

Why is keg craft beer more expensive than cask beer and ale? To find out, I asked some of the south’s top brewers and publicans. Here’s what I learnt.

Kegs – through their association with bland, mass-produced beer and lager – used to be a dirty word when it came to quality beer and ale.

Not so anymore.

While some real ale stalwarts will only drink draught beer served from a cask, savvy drinkers recognise that there are now lots of decent craft keg beers available in the UK.

The cost of keg craft beer

Whether or not cask beer is better then keg (and vice versa) will always be up for debate.

One thing we can all agree on though is that the cost of craft keg beer is generally more expensive than cask beer.

For instance, at the Overdraft micropub in Southampton, all cask ales are a flat price of £3.30 while all keg beers are £1 (30%) more expensive at £4.30.

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There are similar differences at the Butcher’s Hook, also in Southampton. When I checked there recently, the average price of a pint of cask beer (with an average ABV of 4.5%) was £3.53 while the average price of a pint of keg beer (with an average ABV of 6%) was £5.46 – 54% more expensive for 33% more alcohol per serving.

It’s a similar story across the UK – last year, Inapub reported that the average price of a pint of cask beer is £3.24 versus an average of £4.26 for a pint of “craft” keg beer.

That’s a price difference of 31%.

How much does a keg of beer cost pubs?

Pub, bar and restaurants face similar price differences when they buy their beer.

For instance, at drinks wholesaler Dayla, a 40-litre cask of Tiny Rebel’s “Cwtch” is £86.00 (£2.15 a litre) while a 30-litre keg of the same beer is £86.99 (£2.89 a litre). That’s a price difference of 34%.

However, the difference isn’t as high at all wholesalers. For example, at Small Beer Ltd, the difference in price between a cask and keg of Bath Ales’s “Gem” is 23% – £1.97 per litre in cask versus £2.44 per litre in keg.

Why is keg more expensive than cask?

So, why is keg craft beer more expensive than cask beer?

Are we simply getting ripped off when we drink keg beer? Or are there genuine reasons why kegged craft beer usually costs more to buy than cask?

To find out, I asked several south-coast publicans and craft brewers about their experiences with keg and cask beer. Here’s what I learnt.

The benefits of keg for pubs and breweries

There are actually many potential cost-saving advantages to both brewers and pubs when they choose keg over cask.

Benefits of kegs for pubs

In pubs, kegs are easier to store and manage than casks. “It takes a great deal of skill to keep and serve cask beer in good condition,” says Jim Fullegar, owner of Broken Bridge Brewing in Swanmore near Southampton. Broken Bridge has recently begun producing beer in kegs as well as cask.

David Holland, co-owner of the Bear Beer Family, which runs two cask-only micropubs in Christchurch and Bournemouth, agrees with Jim: “There’s less management – and therefore time/cost – involved in keeping a cellar of keg instead of cask.”

Another advantage of keg beer for pubs is that it lasts longer than cask – several weeks instead of several days once opened. So the quality is more consistent over its lifespan. This means the pub can have a greater range of beer on at any one time, which “attracts a wider consumer base,” says Faye Pain of Winchester’s Red Cat Brewing.

Kegs offer pubs more flexibility too. “You can decide what you want to put on without having to tap, vent and wait for it to be ready” says Steve Lee from Southampton beer and gin bar, Belgium and Blues.

Benefits of kegs for breweries

The main advantage of keg beer for breweries is more control over the quality of the beer, because there’s less opportunity for publicans to ruin it through poor cellar management. “There’s nothing more disheartening for a brewer to see their pride and joy managed badly in a cellar,” says the Bear Beer Family’s David.

“That [poor cellar management] is all too common an occurrence in this trade,” adds Vibrant Forest Brewery’s Andrew Mathews.

“I couldn’t begrudge someone that, not knowing who we were, had a shitty pint of ours and decided to never bother with Vibrant again.”

Breweries that use disposable “one-way” kegs have another advantage over those that use casks and steel kegs because they don’t need collecting or cleaning after use. One-way kegs also allow them to send their beers further afield or even abroad without needing to pick up the empty casks afterwards.

Possible reasons why keg costs more than cask

In many other industries, these benefits to pubs and brewers would make keg beer less expensive than cask.

Why then are drinkers paying more – not less – for keg beers at the bar?

Additional costs for brewers

One reason could be the upfront cost of each unit when breweries use disposable kegs. However, this arguably cancels out the costs incurred with washing and collecting casks. So it shouldn’t result in such a price difference when the beer reaches your pint glass.

There’s also the cost of the equipment required if breweries decide to start supplying beer in kegs. Again though, this should balance itself out as it’s not a direct cost to add to the price of each pint at the bar.

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“If you buy a new van instead of an old van to make deliveries then would you add the extra cost onto the product? No you wouldn’t!” says Steve from Belgium and Blues.

It’s worth remembering that keg craft beers are more likely to use premium ingredients or additional hops, which adds to the cost for the brewer. They’re more likely to have a higher alcohol content too, resulting in breweries having to pay more beer duty to the Inland Revenue. However, this isn’t the case for all kegged craft beers. So it doesn’t explain the price differences we see across the board.

Benefits of keg beer for drinkers

There are also several benefits for drinkers that could justify why keg beer is more expensive than cask.

As well as offering consistency in quality and condition and a bigger range of beers in venues that may not turn over enough beer to warrant a large variety of cask beers, some beers are better when kegged.

“Many beer styles present better in the glass from keg, especially continental styles and pales,” says the owner of Red Cat Brewing, Iain McIntosh.

The extra fizz you can achieve with keg beers is another benefit to drinkers. “Beer aroma is carried better by the carbonation from kegging,” says Jim from Broken Bridge.

Vibrant Forest’s Andrew agrees: “Improved carbonation is very useful for beers that do better when carbonated – our sour and saison is only kegged.”

However, while some of these benefits to drinkers could explain why certain beers are more expensive than others, none really justify why the same beer costs more on keg than it does on cask.

Perception and profitability

So far we’ve learnt that keg beers provide many advantages to publicans and brewers, but fewer benefits to drinkers.

So, what’s the real reason why keg beer is more expensive than cask?

Put simply, it’s to do with drinkers’ expectations on the price of cask beer and keg beer’s profitability.

“Unfortunately the big pub co’s pushed the price of cask beer artificially low many years ago,” says Red Cat Brewing’s Faye. “So it’s very hard to make any money on it.”

Over the years, this has influenced drinkers’ expectation of the price of cask beer. “People expect to pay a certain amount for cask beer, and that keeps it deflated,” says Andrew from Vibrant Forest.

Broken Bridge’s Jim agrees with Andrew and Faye: “Cask prices are partially set by public expectations. These public perceptions seem to be set by the huge breweries selling cheap to make beer for very little.

“Cask margins for ‘craft’ beer are very poor and keg margins are more in line with what a growing business would hope to make in order to maintain cash flow and steady growth.”

But how can breweries sell the same keg beer at a higher price than cask?

“As keg beer is relatively new, and it’s appealing to a wider market including a younger and more diverse audience, breweries are able to put a more realistic and sustainable price on their keg products,” says Red Cat’s Faye.

“‘Craft’ beer consumers are willing to pay more for top quality, modern-style interesting beer as they’re often interested and educated about what goes into making the products they’re buying.”

Why keg beer is more expensive than cask

There you have it – keg beer is more expensive than cask because drinkers will pay more for it.

And who can blame the breweries for charging more? Not only do they get all the benefits of keg and avoid the hassle of cask, but they can make more profit too.

Of course, you could say the higher price of keg beer is a sign that craft brewers are ripping us off or putting profits before passion.

We shouldn’t forget though that breweries are businesses. And, like all businesses, they have to eventually make money to survive.

That’s why the difference in the price of cask and price of keg should worry you if you love cask beer – if smaller breweries struggle to make a profit on cask beer, moving to more profitable keg is a no brainer for them.

Ultimately, that would leave us with less choice of cask ale at the bar. After all, some high-profile breweries, including Cloudwater and Buxton, have already ceased producing cask ale. Sure, it’s only a handful of breweries so far. But I’d be pretty annoyed if I could only get my favourite cask beers on keg in the future.

The difference in price might also concern you if you only drink keg beer because, arguably, you’re currently subsidising the price of cask beer in some cases.

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Paying more for cask beer

Clearly then, breweries – especially the smaller ones – need to charge more for their cask beer so it continues to thrive.

The question is, will cask beer drinkers pay more?

And will we ever reach a time where beer is priced based on the ingredients used and effort that goes into producing it, instead of what container its served from?

After all, drinkers quite happily pay a premium for mass-produced beers and lagers like Guinness, Stella Artois and Peroni as well as artisan gins and fine wines.

Why not cask beer too?

“I would encourage people to support their local independent pubs and never scoff at the price of a pint,” says Jim from Broken Bridge Brewing.

“A lot of work has gone in to it from brewer to publican to glass.”

There you go. Brewing great beer isn’t easy – don’t take it for granted.

Over to you

Does to higher price of keg beer or lower price of cask beer bother you?

Would you be prepared to pay more for your beer?