Iconic Tasmanian Brewery James Boag to Close Launceston Production

Australian beer industry stakeholders say the closure of an iconic Tasmanian brewery has left them shocked, some pointing to the growing "unaffordable" cost of brewing beer in Australia.

Yesterday, brewer James Boag announced it would stop production at its Launceston brewery in November.

The 145-year-old brewery has branded its products as being "from the pure waters of Tasmania".

Now, James Boag's parent company, Lion Australia, will move production interstate.

'Terrible for Launceston'

Local Launceston brewery owner Sam Reid said he was "shocked and taken aback" by the announcement, considering the recent state funding injected to the facility.

"We feel for the staff who have lost their roles there, [it's] terrible for Launceston, terrible for the staff and their families," Mr Reid said.

"I thought they were going to be staying focused and committed to Launceston for a while.

"It's not the cost of making beer in Launceston, it's the reality that most of their beer is made at their huge brewery in Lidcombe in Sydney and just the efficiencies they're getting.

In 2023, the brewery received $1 million in funding to keep its visitor centre open.

That money will now be paid back, the company says.

At the time, Premier Jeremy Rockliff said the tours promoted other local businesses and were a tourist drawcard.

Mr Reid, who operates the Du Cane Brewery, said he hoped the $1 million in state funding would be redistributed to other local breweries.

"The new Spirit [of Tasmania ferries] are coming into operation this year, we've got a host of small Tasmanian-owned and made breweries in the north of the state," he said.

"Some of that million dollars could hopefully be used to continue to invest in the visitor economy.

Cost of beer, costing businesses

Independent Brewers Association chief executive Sabrina Kunz said the closure was indicative of the rising cost of brewing beer in Australia.

"For a company the size of Lion, [Boag's] would have been one of their smallest production facilities and they have the opportunity to keep the brand of Boag's going by presumably transferring to one of their larger production facilities," Ms Kunz said.

She has called on the federal government to look at reforming alcohol taxes, which are higher for beer than wine, due to the way the tax on each is calculated.

"Aussies want to be able to shout a round at the pub, they want to be able to host their neighbours for a barbecue and the excise tax regime is making it such that it's simply unaffordable," she said.

"We have been saying for years that the cost of a pint made by a local Australian brewery is becoming unaffordable.

The federal government has been contacted for a response.

Hops Products Australia chief executive Owen Johnston said it was a "terribly sad day for the history of Tassie beer".

"We do know the industry has significant structural problems," he said.

"The capacity in the network of breweries around the country, especially with the big brewers, has always been in excess.

Boag's main rival 'committed' to Tasmania

Rival major international beer brand Asahi, which owns Hobart brewery Cascade, today confirmed in a statement it would not be following suit.

"Asahi Beverages, the owner of Cascade, is committed to the future of the iconic brewery — Australia's oldest brewery," a spokesperson said.

"This year, we committed $13 million for a capital upgrade of Cascade brewing and cider equipment.