What a difference at Melbourne airport. “G’day, Roger, what brings you to Australia?” the beaming official at the passport desk asks. “A beer festival? Jeez, mate, I’ll see you there!”

Australia lives up to its image. Everyone is “mate” because it’s a matey kind of place. As someone originally from London’s East End, where “mate” is also common currency, I felt immediately at home Down Under.

There’s a second, potent reason for feeling at home there: it’s a great beer drinking country. Only the Czechs out-drink the Aussies and in Australia the beer scene is changing rather more dramatically than it is in the Czech Republic. If Foster’s is your favorite tipple, don’t bother to go. What was once considered an iconic Australian beer―the “amber nectar”―is hardly featured prominently in the scene. In a week in Melbourne and Adelaide, I don’t recall seeing a single tap for Foster’s.

Even Crocodile Dundee shuns it now and the company that makes it has reverted to its original name of Carlton and Union Breweries. CUB’s main brands are Victoria Bitter, the biggest-selling beer in Australia―and a lager in spite of the name―and Carlton Draught.

With Lion Nathan (owned by Kirin of Japan), which brews Castlemaine XXXX, Toohey’s and Swan, the two giants command 95 percent of the Australian market. Cooper’s of Adelaide, doughty brewers of Sparkling Ale (see sidebar), has a further three percent, which doesn’t leave much room for anyone else. But an astonishing number of small craft breweries have sprung up to grab the remaining two percent of the market.

The craft brewers were on show at Beer Expo in Melbourne in the spring―autumn in Australia. It was the brainchild of David Lipman, publisher of Beer & Brewer Magazine, a glossy publication dedicated to all things beery in Australia and New Zealand. Thanks to the efforts of craft brewers and writers, Australians can now move beyond bland lagers and savor pale ales, an abundance of IPAs, porters and stouts, alongside Belgian and German-inspired wheat beers, golden ales and true pilsners.

While it is a great tagline and Fosters is Australia’s most successful beer brand export (the beer itself isn’t exported), it is rarely consumed in Australia. The title of most popular beer in Australia instead falls to another label from the Fosters stable, Victoria Bitter—or, more simply, “VB,” with just over seventeen percent of the national market.

Although they won’t find Fosters, visitors will find plenty of beers that taste similar. In a blind tasting between Fosters, VB and many of the other mainstream beers, most Australians would be hard pressed to pick “their” beer, such is the similarity of the Australian lagers—and to most Australians lager is beer and beer is lager.

But a quiet and flavorful revolution is starting to take place, one that in many cases is inspired by American beers and even American brewers. It’s a revolution that had its seeds sown in the late 1980s.

Like the United States, the Australian brewing industry spent much of the 20th century in a period of slow consolidation resulting in a handful of breweries producing mainly lagers. Despite their similarities, these brews were sold almost exclusively within state borders. Whether this was due to drinker parochialism or gentlemen’s agreements between brewing companies not to encroach on each other’s patch is debatable, but it meant that in enormous states like Queensland you would have the bizarre situation of the “state” beer, XXXX, being shipped 1000 miles north to Cairns but not 70 miles south to towns the adjacent state of New South Wales.

The 1980s ushered in a period of wheeling and dealing in the beer industry that saw the spectacular rise and fall of brewing entrepreneurs such as Alan Bond, whose Bond Brewing briefly straddled the globe—including a foothold in the United States where he owned G. Heileman—before spectacularly crashing in the early ‘90s.

In the washup, two major brewers, Fosters Group and Lion Nathan, remained, controlling between them in excess of 95 percent of the Australian beer market. Like all of the major international lager producers, these companies made beers that were perfectly consistent, light and unchallenging for the average drinker. They were popular but they also call to mind a famous joke involving Coors and a canoe.

The great irony of the Australian craft scene is that the man who is perhaps most identifiable with the current growth of flavorsome craft beer led the team that developed Coors Light in the 1970s.

Australia is a country marked by unfair stereotypes. Aussie beer drinkers are often seen as cowboys who spend their nights in dusty country bars, chugging giant cans of bland lager. Truth is, most Australians are city-dwellers, and the big “oil cans,” while still sold overseas, were abandoned in Australia decades ago.

What is true is that Australians do tend to prefer international-style lagers. Walk into a typical Australian beer store and you’ll find lots of brands—Victoria Bitter, Carlton Cold, Foster’s Ice, Toohey’s New, Swan Lager—but very little difference in taste.

True, in the US beer market, the big three brewers produce 80 percent of the beer, most of it in the international style. That still leaves 20 percent of the market available for over 1,000 small breweries to launch the American beer revolution.

But the Australian picture is extreme: just two mega-brewers, Foster’s and Lion Nathan, produce nearly 95 percent of all beers sold.

In the past five years, a rising number of independent brewers—both Australians and a surprising number of expatriate Americans—are struggling to make Australia’s beers more interesting. These little brewers face formidable obstacles but they are slowly introducing Australians to the global beer revolution.

Nine decades of consolidation

Australians have been consolidating breweries ever since six Melbourne breweries joined forces in 1907 to form Carlton and United Breweries, or CUB. One of the six breweries was Foster’s. Over the past two decades, Foster’s Brewing has used Foster’s as its international brand name while calling its Australian division CUB.

In 1983, Foster’s was taken over by Elders IXL, a farm equipment manufacturer. Under Elders’ control, the firm went on a global buying spree, purchasing Courage in Britain in 1986 and Carling O’Keefe in Canada in 1987. (When Molson merged with Carling O’Keefe, the deal gave Foster’s control of 50 percent of Molson.) The company grew to be the world’s fourth largest brewer, and Foster’s chairman boasted that he would “Fosterize” the world. But the stock market crash of 1987 left Foster’s overextended and bleeding red ink. By the time Ted Kunkel became Foster’s CEO in 1992, the company’s future was in doubt.

It’s fair to say that the company had hit desperate times,” Kunkel told The Bulletin (an Australian news magazine) recently. “We were fighting for our very survival. With the debt load we had, we virtually had to ask our shareholders to save us.”

Under Kunkel’s leadership, Foster’s split off from Elders and issued new shares to help pay off its debt. It also sold several foreign subsidiaries, earning A$2.2 billion (US $1.6 billion) from its sale of Courage to Scottish and Newcastle and A$1.1 billion (US $750 million) from selling Molson the 50 percent of its stock that it owned. The result is that, under Kunkel’s leadership, Foster’s stock price has tripled and its debt has been sharply reduced.

Australia’s second big brewer didn’t come into existence until 1985, when financier Alan Bond, who already owned the Western Australian Swan Breweries, purchased Castlemaine Toohey Breweries (which owned breweries in Queensland and New South Wales).

The stock market crash of 1987 put an end to Bond’s brewing ambitions. His personal financial collapse left his breweries alive but suffocating from debt. In 1990, he sold his properties to the New Zealand firm of Lion Nathan, whose best-known brand is Steinlager. In 1998, Kirin purchased 45 percent of Lion Nathan.

Both Lion Nathan and Foster’s have been buying steadily in the 1990s. Lion Nathan’s purchases in this decade have included South Australian Breweries, a well-established regional brewery, and Hahn Breweries, a Sydney-based firm started by an expatriate American. Foster’s has purchased both Tasmania’s Cascade Brewery and the Northern Territories’ Darwin Brewery.

Foster’s and Lion Nathan have tried to keep some distance from these recent acquisitions, much in the same way that Miller keeps Leinenkugel as a distinct division. This ensures variety in the Australian premium beer market. Cascade products tend to be hoppier and more assertive than other CUB products; South Australian Breweries produces a stout that the Beverage Testing Institute names as one of the 10 best imports of 1999. And Michael Jackson praises two other Lion Nathan products: Hahn Premium and Toohey’s Old Black Ale.

In 1999, Foster’s controls 56 percent of the Australian market (up from 48 percent a decade ago), while Lion Nathan has 38 percent. Two surviving Australian independent regional brewers—Coopers in Adelaide and J. Boag and Son in Tasmania—each control 2 percent, leaving the remaining 2 percent for smaller brewers and imports.