Are Higher U.S. Beer Prices on The Rise?

A recently proposed rule by the U.S. Food and Drug Administration (FDA) could have a crippling effect on breweries and distilleries, which in turn would raise prices for consumers. So, what exactly does this new rule aim to achieve?

The FDA’s new rule would require breweries and distilleries to package their spent grain before redistributing it to other farmers or companies. Currently, many breweries and distilleries haul their spent grain off to nearby farms where it’s reused as protein-rich animal feed. The breweries and distilleries benefit from this action since it allows them to remove their spent grain, while the farm benefits from the constantly supply of free animal feed. But this symbiotic relationship may soon come to an end, as the FDA is working to break the chain by forcing breweries and distilleries to package their spent grain before sending it away.

Having breweries and distilleries repackage their spent grain may not seem like a massive change, but it could have devastating consequences for some businesses, especially smaller ones. With the average cost for setting up a grain repackaging facility hoovering around $10 million — not to mention the cost of labor and materials necessary for the actual procedure — the financial burden may prove to be too much for some to handle.

Why is the FDA trying to pass this grain repackaging rule? The rule stems from the Food Safety Modernization Act, which President Obama signed into law back in 2011 in an effort to curb food-borne illness. According to the Centers For Disease Control and Prevention (CDC), nearly 48 million Americans become become sick from food-borne illness each year, many of whom are forced to seek medical treatment from hospitals and local care facilities. The Food Safety Modernization Act aims to reduce these numbers by encouraging cleaner farming practices, such as the repackaging of spent grains before distribution.

The public can submit their comments on the grain repackaging rule this summer. It’s expected to go into effect in 2015.

“The proposed rule, “Current Good Manufacturing Practice and Hazard Analysis and Risk-Based Preventive Controls for Food for Animals,” is published in the Federal Register so that the public can review it and submit comments. FDA considers comments received during the comment period on the proposed rule and then considers revising the rule, based on its review of the comments, before issuing a final rule,” states the official FDA website in regards to the proposed rule.