Millions of gallons of expired beer could end up costing the booze industry $1 billion

• Beer is expiring in untapped kegs around the country and breweries are taking the hit after ramping up production for events in March that proved to be a bust because of the coronavirus outbreak, according to a recent report.
• Dealing with millions of gallons of unopened beer, worth nearly $1 billion, is proving to be a headache for companies as environmental and logistical concerns prove costly.
• Other industries, such as oil and farming, are also feeling the negative effects of excess supply during the pandemic.
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The beer industry is dealing with an unusual problem – there is too much beer and it’s starting to expire, according to a report by The Wall Street Journal.

Millions of gallons of beer was produced in March in preparation for St. Patrick’s Day and “March Madness” basketball tournament, according to the Journal, but now that beer is going to waste as it sits undrunk in kegs around the country at places such as concert and sporting venues, as well as restaurants and bars.

The 10 million gallons of unused beer could translate into a $1 billion loss for the industry, the report said, and leaves producers struggling to dispose of the stale suds as they begin the process of retrieving the kegs.

As breweries embark on the process of collecting kegs, several challenges appeared, according to the Journal, including difficulty retrieving full kegs (which are more costly to transport than empty ones) and the disposal of the surplus supply, which cannot simply be dumped down drains because it risks offsetting waterways’ pH levels and creating unwanted bacteria.

Brewers such as MicroStar Logistics LLC, the U.S.'s largest keg-logistics company, plan to dilute the beer with defoamer in order to safely get rid of it, The Wall Street Journal said in the report.

The disposal of beer doesn't just have logistic considerations, but financial ones too. The unsold bulk of inventory means someone gets hit with economic losses. Budweiser brewer Anheuser Busch InBev SA, Guinness maker Diageo PLC, and Modelo owner Constellation Brands Inc. are a few of the brewers who choose to share the cost of the undrunk beer with their distributors to prevent already suffering bars and restaurants form incurring the loss.

Other industries have also been upended amid the pandemic, including oil, produce, cruises, and flights.