The Beer Hacker: Brewing on the cheap

This is the first part in a series of articles about the economic impact of brewing your own beer at home. This first article is an introduction and sets up our assumptions and base numbers to work with; later articles are going to look at the relative costs of brewing different styles of beer, extract versus all-grain, and exploring if it’s possible to brew quality beer for $20 or less.

It’s no secret that beer prices have been rising in recent years: unless you’re drinking macrobrewed lager or have a local, large-ish microbrewery, you’re likely paying in the neighborhood of $7 to $12 for a six-pack of beer, maybe more if the beer is harder to get or exclusive somehow. (Dogfish Head, for instance, sells four-packs for $11 to $12.)

Enter homebrewing. The prospect of brewing your own quality beer for far less than what you’ve been paying retail has huge appeal, particularly these days. But is it true? There’s been some debate lately over whether brewing your own beer is truly cheaper (in the long run).

Personally, I think homebrewing is the cheaper alternative—but I’ve never taken the time to fully explore that assertion. I want to definitively answer the question, “Is homebrewing really a more economical way of keeping you supplied with beer?”

Let’s look at some numbers to get a baseline for how much you can expect to pay for good beer:

  • I find on average that a five gallon batch of homebrew yields approximately 48 12-ounce bottles, or two cases of beer.
  • Here in Oregon, craft beer prices average $7-10 per six-pack. At that price, that’s approximately $56 to $80 for two cases.
  • However, buying by the case at, say, Costco, you’ll average $23 per case for the same or similar beer, or about $46 for two cases.
  • For truly cheap macrobrewed beer, say Pabst Blue Ribbon, I think you can buy it for about $14 per case, or $28 for two.

Looking at this breakdown, it becomes immediately clear that buying beer by the six-pack is a ridiculously expensive way to go if you’re looking to cut back and save money. To do that, you need to look at buying in bulk—in other words, by the case.

(Of course, not every craft brew is easily available by the case, nor is it available at Costco—i.e., warehouse—prices. But for simplicity’s sake I’m going with these figures; naturally, if beer costs more in your area, then you have more leeway to work with.)

Based on these numbers, my back-of-the-napkin calculations seem to indicate that the “magic” price to beat for microbrewed-quality beer (two cases worth, which is what a typical homebrew batch will approximately yield) is right around $46.

So we have our “economical price point.”

Let’s figure out some base prices for beer ingredients. First, some assumptions:

  • I’m completely overlooking the start-up costs associated with homebrewing (that may be a future article), and assuming that we’re working with the cost of ingredients for a five gallon batch only.
  • I’m only examining extract-based brewing (for now). When you get into bulk grain prices, the numbers change (that will be a future article).
  • Prices I quote for homebrewing ingredients are generally based on what I’ve seen at my local homebrew shop, but certainly may not apply everywhere. I’ll also try to compare prices against online sources if applicable.

With those in mind, here is a basic table of prices:

Ingredient Price Price (online)
Malt extract syrup – 7 lbs. $18.00 $16.50
Malt extract – dried – 3 lbs. $11.00 $11.25
Malt extract – dried – 1 lb. $4.25 $4.40
Grains – per pound $1.90 $1.45
Specialty grains – per pound $2.25 ~$2.00
Hops (whole leaf) $5.00 – 6.50 $5.50+
Liquid yeast $6.50 $6.00 – 10.00
Yeast – dry $1.25 – 3.95 $1.20 – 4.00
Corn sugar – 1 lb. $1.25 $1.00 – 2.00

As we can see, the prices are generally comparable, so I’ll use my local price references most of the time.

As a quick exercise, let’s figure out the cost of a five-gallon batch of Pale Ale, using liquid yeast and two ounces of hops. I’ll throw in some grains as well to make it interesting.

  • 7 lbs. light malt extract syrup: $18
  • 0.5 lbs. 10°L Crystal malt: $0.95
  • 0.5 lbs. 40°L Crystal malt: $0.95
  • 0.1 lbs. Roasted barley: $0.25
  • 2 ounces Cascade hops: $5
  • Yeast: $6.50
  • Corn sugar (for priming at bottling time): $1.25

Total: $32.90. Yield: approximately two cases of moderately-hopped Pale Ale, roughly 5 to 6% alcohol by volume.

Remember our economical price point for two cases of microbrew? $46. So already, brewing a fairly basic beer, we’re ahead $13.10.

(Naturally, there is time involved too—four to six weeks, say—and I’m not accounting for the cost of bottles and bottle caps. Bottles can, of course, be recycled from the beer you’re already drinking; and caps will probably cost $3-4 for 144 or so.)

Seems pretty straightforward, right? At first glance, it appears brewing your own beer is cheaper than buying it. But remember, this is for a pretty basic style of beer, without a lot of bells and whistles.

So a question to keep in mind which I’ll address in the next installment: about how much can you expect to spend on various styles of beer?

And, a bonus question for later on: how much cheaper can we go?

10 Responses to The Beer Hacker: Brewing on the cheap

  1. Matt says:

    Brew All grain and its cheaper and No Boil Kits like Coopers are pretty economical compared to extract brewing .

  2. eric says:

    In terms of reducing costs: Re-using your yeast is a big one, Saving $6.00 per brew.

    As an all-grain brewer it is impossible to ignore the cost of equipment. If I had to start from scratch I would make smarter choices but the brewery and related equipment I have now would cost around $600 which, if amortized over 6 years of brewing once a month would add $8.00 to each batch.

  3. Jon says:

    Matt, I plan to look at all grain brewing too–the funny part is, for all the years I’ve been brewing I’ve never made the leap to all grain. :)

    The “no boil” kits are interesting and worth looking at, thanks for the idea! Come to think of it, the “Brew in a Bag” method I’ve heard about would be something to consider, too–another all grain method.

  4. Andy Gray says:

    After the base malt extract, the largest relative expenses are the yeast and the hops.

    * For yeast, it’s relatively easy to harvest the yeast from a previous batch and save it for a subsequent brew. That ~$6 can then be divided across several batches, not just one. You can also use dried yeast, which is usually substantially less expensive than liquid yeasts.

    * For hops, grow your own! While you probably won’t get much of a harvest the first season, hop plants grow easily and can yield as much as a pound of hop cones per plant (and they’re pretty vines besides). Hopefully the retail price of hops will decline somewhat after this season’s harvest.

    Taking $10-$12 out of the supply bill gets closer to your $20/batch target.

    — Andy

  5. Jon says:

    Eric–great point. Maybe I’ll do an “advanced money-saving techniques” article too. Yeast is a big one.

    Equipment can be a big stumbling block on the $$$ road to brewing, which is why I’m overlooking the costs of it (for now). And all grain equipment is definitely going to cost more than for extract brewing–another reason I’m focusing (initially) on extract brewing.

    You make a good point, though, with amortizing the equipment costs. I was thinking about touching on that myself in one of the later articles.

  6. Jon says:

    Andy– absolutely! Besides the yeast, the hops are another good one to touch on. Even if you can grow your own, you might be able to find people near where you live who are growing hops that might let you harvest them.

  7. David says:

    Going all-grain does not have to be expensive at all. I went all grain for $11 and I probably made that back on my first batch I brewed with it. See my $11 mash tun here:
    http://www.flickr.com/photos/croixboy/sets/72157614137261210/

    Hops seem easy to grow. Mine really took off in the 2nd year but these pictures are from the first year. (http://www.flickr.com/photos/croixboy/2744533259/).

    Also, you can save money by saving the hot water that comes out of your wort chiller and dumping it into the wash machine for a load of laundry or the bath tub for a hot bath. It’s hot water that your water heater doesn’t have to use energy on!

  8. Jon says:

    David, I might refer to you in the future for all grain conversion notes. :)

  9. Jerry says:

    The no-boil kits are nasty I tried one and dumped it. I think if you try a no-boil kit use a different yeast then the one supplied. I also found most of my all-grain equipment at garage sales or craigslist. My last 10 gal. batch cost me about 37 dollars, so that’s about 80 pints which equates to about .46 cents a pint, not bad. Cheers!

  10. David says:

    Great articles Jon!

    I’m no ‘expert’ but I’ll try to help when I can. I’ve been trying to milk every penny out of brewing since I went all grain early this year. I also brew double batches with another brewing friend, we just split the cost down the middle and it saves us both a few bucks and more importantly in this case, man hours.

    I noticed the link of the hops in my previous post had an extra character on it. Here is a working link:

    http://www.flickr.com/photos/croixboy/2744533259/