Can you make beer cheaper than you can buy it?

New Albion, now

New Albion, now (Photo credit: cizauskas)

The answer is a definite maybe not.

You may be able to brew your own beer cheaper than you can buy it at the supermarket unless we are talking a Bud/Miller/Coors product, and then only if you never make a mistake and have a bad batch (they do happen, even to the big guys), don’t include your labor time, or the equipment.

I just brewed a batch of a New Albion pale ale clone. If you’re not familiar with New Albion, it was the craft beer brewed by a micro-brewery (in the days when Anchor Brewery was considered a small brewery), the year was 1976. (I will write more about New Albion’s history in another post.) The recipe is simple with no specialty ingredients needed. It is base malt plus a small amount of hops, and water and yeast. The simplicity lowers the ingredients cost and the time.

My calculations (below) show that I can brew a New Albion clone for $0.127 per ounce versus buying one from the supermarket for about $0.136. Or put another way, a bottle of my clone costs $1.52, which is 11 cents cheaper than a store bought version. My calculations include the cost of bottles and labor (at minimum wage).

Now, you can argue that you won’t need to buy bottles every single time (and you would be right). You might not even have to buy bottles at all and have them donated to you by friends. If you go the used bottle route, there is still a cost, the cleaning and sanitizing will take time and materials to get them ready to fill.

You might not want to include your labor, but it needs to be included (even if it’s only at minimum wage rates) because it is what economists call the “opportunity cost.” Your time is not worthless. Instead of brewing beer you could be doing something else, perhaps earning money at the minimum wage. I used four hours for the time needed to set up, mash, sparge, boil, cool, transfer to fermenter, and clean up afterward (which may be a little tight). My time for all of that is around the six hour mark, which would mean that it is cheaper for me to buy my beer than to make it (by $0.17 per bottle). I am paying for the privilege and fun of the brewing day.

The cost of equipment type stuff, boil kettles, mash tuns, etc., has been ignored; though when you throw that in it certainly tips the scales in favor of the buying of commercial beers.

The costs of brewing versus the cost of buying  are here:

Ingredient price per unit unit Amount Total
2-row pale malt $0.73 lb 12 $8.76
Cascade hops $1.25 oz 2.1 $2.63
Safale American 05 yeast $2.99 ea 2 $5.98
Propane $2.49 gallon 2.5 $6.23
Bottles $12.95 case 2.2 $28.49
Corn sugar $1.95 lb 0.25 $0.49
Labor $7.25 hr 4 $29.00
Total $81.57
Price per ounce $0.127
price per 12 oz bottle $1.53
New Albion (with CRV and sales tax) $9.79 6 pack 1
Price per ounce of Sam Adams New Albion Ale $0.136
price per 12 oz bottle $1.63