Upsetting the Apple Cart

American Cider Makers Adapt to a Changing Market

November 1, 2000 By Greg Kitsock

With regard to hard cider, America has played the role of a fickle lover. There have been times when we couldn’t get enough of the stuff. And there have been times when the drinking public almost forgot that cider existed.

Could the cycle be repeating itself?

After decades of obscurity, an anachronism from Currier and Ives prints, cider reasserted itself in the 1990s, riding the coattails of the craftbrewing movement. Case sales soared from a minuscule 145,000 cases in 1990 to 1.6 million in 1995.

“Another burgeoning beverage craze,” reported the Wall Street Journal. “The long-awaited revival of an honorable American tradition,” proclaimed the New York Times. Joseph Cerniglia, the New York stockbroker who helped spark the cider craze by founding Cerniglia Wineries (later Green Mountain Cidery) in 1986, confidently predicted sales of 50 million cases per annum by 2000. Major players in the beverage industry like E. & J. Gallo, Stroh and Miller scrambled to get their foot in the door.

The icing on the cake came in 1997 when Congress passed a tax relief bill that lowered the excise on ciders under 6 percent alcohol by volume (abv) from a maximum of $1.07 per gallon to a more beer-like 22 cents per gallon.

The good times have yet to roll, however. Growth has slowed from triple digit to double digit to single digit. Cider registered a 1 percent decline for the 13 weeks in mid-summer, according to ACNielsen, a consumer data service that monitors supermarkets and chain stores.

Instead of small cideries sprouting up around the country, the fledgling industry seems to be imploding. H. P. Bulmer, the British giant that turns out Woodpecker and Strongbow, bought the Green Mountain Cidery from the now-defunct Stroh for $14 million in 1998. Late last year, Bulmer snapped up another rival, the American Hard Cider Co. (maker of the Cider Jack brands), for a sum reported to be about $30 million. The transaction was remarkably low key; just imagine the brouhaha if a major British brewer like Whitbread or Scottish Newcastle had absorbed Miller and Coors in the space of two years!

Bulmers America Inc., as the US subsidiary is now known, has centralized its operations in Middlebury, VT, and is set to bring out another line extension, Woodchuck Pear, this fall. Reliable statistics are hard to obtain for cider, but Bulmer, by the most conservative estimates, owns close to 50 percent of the market.

“They wish to dominate the world and I think they’ll achieve it,” said Jeffrey House, founder and president of the much smaller California Hard Cider Co. in Sebastopol, CA.

Cider’s Appeal

During the last century, rival beverages like lager beer and soda pops siphoned off much of cider’s clientele. Now, fruity, malt-based drinks are threatening to do the same. Joe Whitney, brand manager for Boston Beer Co.’s HardCore Ciders, calls them “New Age malt-ernatives.” “There are tons of them out there this summer,” he noted in an interview.

The alternative beverages range from Zima to hard lemonades like Hooper’s Hooch and Doc Otis, to fruit coolers like F. X. Matt’s Strawberry Blush, and to Soma, a lemon-and-herb-flavored nonalcoholic beer. These tend to appeal to young drinkers who prefer a sweeter alternative to beer, he says–the same crowd that’s most receptive to cider.

In the long run, Whitney still thinks that cider has a promising future. “People usually go back to more traditional things.” In the short run, HardCore Cider Co. will try to hook more drinkers by introducing a light, refreshing “entry-level” cider made with Golden Delicious apple concentrate. Look for it this September.

Several of the bigger players became disillusioned. When E. & J. Gallo leapt into the market in 1995 with its George Hornsby’s ciders, the nation’s largest winery immediately assumed the number one cider position. But sales have stalled around 1 million cases, and Gallo seems unwilling to devote the money or effort to make Americans more cider-conscious. According to a recent profile in Fortune magazine, Gallo–best known for labels like Thunderbird and Bartles & Jaymes–is more interested in exploiting the high end of the wine market, where cabernets and pinots sell for $15 a bottle and up.

Miller Brewing in the mid-1990s acquired the rights to import Dry Blackthorn, a product of England’s Taunton cidery (later acquired by Matthew Clark Brands Ltd.). Dry Blackthorn once held a third of the US market before a plethora of domestic brands burst onto the scene. But Miller was unable to grow the brand, and in 1997 ceded its rights to Sunshine Imports of Los Angeles. “They did a great job killing the product,” groused Victor Garcia, brand manager for Dry Blackthorn. “We basically had to start from scratch.”

Meanwhile, the tax break has been less of a windfall than some cider makers would have hoped for. The wording of the legislation was quite strict: it applied only to ciders made “primarily from apples or apple concentrate and water, containing no other fruit product.” This left little wiggle room for the Bureau of Alcohol, Tobacco and Firearms, which was forced to deny the tax break to popular mixed-fruit ciders.

Consequently, Boston Beer Co. dropped its HardCore Cranberry Cider, replacing it with HardCore Black, a cider made with caramelized apple juice and aged with oak chips for an astringent nip in the finish.

But that wasn’t an option for several West Coast cideries that do most of their business in pear-, peach- and berry-flavored ciders. “On the East Coast, cider is more of a traditional, colonial-type drink, while on the West Coast it’s thought to be more of a new wave beverage,” explained David Cordtz, founder of the Sonoma Cider Mill in Healdsburg, CA (which markets pear and berry ciders). Bill Gibbs, a partner in Oakland, CA-based Wyder’s Ciders, says the limitation is unfair. His own Wyder’s Pear, Peach and Berry Ciders, he notes, are fermented from 100 percent apple juice, to which is added a pinch of fruit essence. That pinch accounts for a fraction of a percent of the entire product.

Wyder’s and several other producers have been lobbying for either a change in the law or a more liberal interpretation on the BATF’s part. “Stay tuned on that one,” added Gibbs.

Draft or Craft?

Although it’s often compared with craft beer, the cider industry differs in one important respect. Beer aficionados make a sharp distinction between national brands and microbrews. Many drinkers wouldn’t be caught dead chugging a Bud or Coors, and some purists even eschew Sam Adams and Pete’s Wicked Ale because these companies have grown too big.

Cider, on the other hand, is such a new and exotic drink that few consumers make a distinction between mass market and “craft” ciders. Multitap bars specializing in exotic beers might fill their lone cider tap with Woodpecker, a light, fruity British import that in its homeland is considered the equivalent of Budweiser.

Most of the larger American companies produce cider in the “draft” style. The term is a little misleading, because draft cider can come in a bottle (or, in the case of another English brand called Strongbow, in 500 ml cans). Ciders of this type tend to be fruity, quaffable and thirst quenching, but not always terribly complex. Typically, they’re produced by fermenting apple juice to 10 percent abv or higher, then diluting the liquid with fresh juice, water or high-fructose corn syrup to adjust the taste and bring it back below 6 percent abv.

Traditional Tipples

The alternative to draft is farmhouse cider. As the name implies, this is cider made the traditional way, without the benefits of filtering or forced carbonation. These ciders can reach an alcohol level of 12 percent by volume and are sometimes attenuated to the point of being bone-dry.

You might have to take some detours down remote country roads to sample some of these more complex ciders. Take the Smokehouse Winery, which occupies an old home, a garage and a cabin in rural Sperryville, VA. Owner Jon Hallberg (who formerly worked for the Richbrau brewpub in Richmond, VA, and the defunct Mount Vernon Cidery in Sperryville) makes a seasonal crabapple cider that incorporates antique English apple strains. These include varieties such as Esopus and Ashmead Kernel, obtained from an orchard in Front Royal, VA. “Last year, we did it in cask only, but this year we might do a few bottles,” says Hallberg.

He specializes in traditional American tipples, making several kinds of mead (a fermented honey beverage), including a metheglen (a spiced mead), a melomel (a fruit mead) and a bragot (a hybrid mead-ale fermented from malt and honey). The products are available in wax-sealed 500 ml bottles at a few outlets in central Virginia and at the Smokehouse Winery’s tasting room.

Just in case you don’t feel like driving afterwards (the cider clocks in at 5 percent abv, the meads at 12 to 14 percent abv), the business doubles as a bed and breakfast inn. The Smokehouse Winery is at 10 Ashby Lane in Sperryville, about a two hour’s drive from Washington, DC; telephone 540-987-3194.

Also worth a visit is the country’s only cider pub. The Ace in the Hole can be found in California’s Sonoma County, a region as renowned for its apple orchards as its vineyards. The facility was opened last year by Jeffrey House of California Hard Cider Co. The restaurant tasting room (seating 80 inside, plus another 80 on the patio) is designed to exude a country general store type of atmosphere, with furniture crafted from Heinz pickle barrels. On tap are the four brands that House sells nationwide: Ace Apple, Ace Pear, Ace Berry and Ace Honey (the latter a rare example of cyser, a kind of cider/mead hybrid).

Available only at the pub are some limited-edition experimental ciders. House has offered a “scrumpy,” an unfiltered farmhouse cider of great potency. “We can serve you only half a pint,” says House of the 9 percent abv scrumpy. “Otherwise, you might lose your head.” To celebrate Y2K, House offered Ace Millennium Cider, a drier, semi-sparkling European-style cider sold in swing-top bottles and packed in redwood cases. He’s also planning to do a varietal cider made solely from Gravenstein apples, a locally grown strain whose “juice has more bite to it.”

The Ace in the Hole is at 3100 Gravenstein Highway North in Sebastopol, CA, 707-829-1101.

A Century-old Cidery

Even the most hidebound traditionalists will appreciate B. F. Clyde’s Cider Mill in Old Mystic, CT. The oldest continuously operating cidery in the country dates back over a century to 1881. Annette Miner, who manages the business with her husband, Harold, is the fourth generation of her family to run the cider press. The business survived Prohibition by making vinegar, but Miner suggests that not all of its product wound up as salad dressing. “My great-grandmother was arrested twice for bootlegging,” she laughs, adding that neither of the charges made it to court.

B. F. Clyde’s Cider Mill makes a dozen products measuring from 6 percent abv upwards. One is a hard cider made entirely from Russetts, which Miner describes as “the nicest hard cider apple grown in this country.” Another is a sparkling apple champagne, which acquires its fizz naturally from the addition of a teaspoon of priming sugar to each bottle. “We don’t do a lot of that one,” said Miner. You can blame the tax man: ciders that contain a significant amount of carbon dioxide (specifically, more than .392 grams per 100 milliliters) are zapped with a champagne tax of $3.40 per gallon. Unlike the normal wine tax, there is no break for small producers.

B. F. Clyde’s also produces a variety of “apple wines” measuring up to 14 percent abv, including apple/cranberry, apple/raspberry and apple/cherry. Incidentally, Miner dislikes the term “apple wine,” which she considers an artificial designation foisted on her by the BATF. When Congress created a new tax category for lower-alcohol ciders, she explains, the agency decided that the term “hard cider” could be applied only to those brands below the 6 percent abv ceiling.

“It’s hard for us to differentiate,” says Miner of her fermented apple products. “They were all hard ciders when I was growing up.” (Indeed, the BATF received so many complaints–including a letter from Vermont senators Patrick Leahy and James Jeffords, who introduced the federal cider legislation–that the agency has decided not to enforce the distinction.)

Cider production at B. F. Clyde’s is quite different from that at the larger cideries. Virtually all the big companies, for instance, dose their products with potassium sorbate or sulfites to kill yeast and other microorganisms. Otherwise, their products, which are low in alcohol and high in residual sugars, might experience an uncontrolled fermentation, exploding the bottle, or turn slowly to vinegar through a process called acetification.

Miner, by contrast, adds no preservatives. “We sell everything on the premises,” she asserts. “And whatever we make, we sell out in 10 weeks.” Annual production amounts to 7,000 gallons, or a little over 200 barrels.

Whereas the big cideries usually buy their juice already squeezed, Miner presses her apples using an 1898 steam-powered cider mill that by all rights ought to be in the Smithsonian Institution. In fact, she notes that her mill is recognized as a historical landmark by the American Society of Mechanical Engineers.

When it comes to self-sufficiency, Elizabeth Ryan goes even further. Ryan, owner of the Hudson Valley Cidery/Breezy Hill Orchards in Staatsburg, NY , grows her own trees…over 1,000 of them. To keep them fruitful, she sings carols to them every January, in keeping with an old English custom from Somerset.

Only locally grown apples make their way into her products: Maeve’s Draft Cider, Maeve’s Draft Perry, Hudson Valley Farmhouse Cider and Hudson Valley Farmhouse Perry.  These beverages are aged several months and undergo a secondary fermentation with a malolactic bacteria that Ryan feels rounds out the flavor.

Once available only in New York and a few bordering states, Hudson Valley ciders will undergo a national rollout beginning this fall. “I hope sophisticated consumers will seek out and support artisanal ciders,” Ryan says. “There’s a big difference between ciders produced from concentrate and those produced from fresh juice.” She echoes the fear of other small cidermakers that customers are acquiring a taste for “a sweet, cooked apple profile” typical of national brands.

Growing Niche

In all fairness, despite concerns about the US cider industry, there are many bright spots as well. Despite competition from other new-wave beverages, HardCore’s Joe Whitney reports a 27.5 percent sales hike. Jeffrey House says he’s tripling capacity to keep with demand for Ace Ciders. Wyder’s Bill Gibbs insists that “we’ve doubled our capacity every other year for the past six years.”

New blood continues to liven up the industry. The Smokehouse Winery began production last year, and the Sonoma Cider Mill didn’t sell its first bottle until March 2000. Importers are also trolling for new products. B. United International of Elmsford, NY, best known for its portfolio of English and German beers, also imports a pair of ciders from Normandy, France.

“Cider is still a niche product,” cautions Sonoma’s Dave Kordtz, but it’s much less nichey than it used to be. Kordtz, who broke into the business as cider maker for House, recalls, “When I started out, the only places I could sell cider were English and Irish pubs.” Today, he says, cider sells well among women drinkers, in college towns with large populations of 21- to 35-year-olds, along the Eastern Seaboard and in warmer climates like California, Arizona and Texas.

“There’s a much larger audience for cider than I ever imagined,” Gibbs said.