Monocacy brewery

Tom Flores, brewmaster, checks on the level of hot water in one of the brewkettles in between making batches of beer at Brewer's Alley, the brew pub on Market Street. (Barbara Haddock Taylor, Baltimore Sun / November 8, 2011)

The Brewer's Alley brew pub in the heart of downtown has been chugging along for 15 years, slowly adding artisanal beers to its stable, resisting temptation to expand when it seemed every wannabe brewer with some start-up capital and a disdain for Budweiser got into the craft beer business.

This year the pub faced a crucial test: "What we had to decide a little while ago was, either stay at capacity as a small pub, or continue to meet demand and possibly create more demand," said Tom Flores, brewmaster at Brewer's Alley. "We decided to go for it."

Two months ago, they opened their own brewery, Monocacy, which has plans to produce as many as 3,000 barrels of beer by the end of next year and already has a contract to supply a ballpark, the Frederick Keys' Harry Grove Stadium.

In Maryland, and across the country, brewers are quickly coming around to Brewer's Alley's thinking.

With sales of craft beer far outpacing those of mainstream lagers, they have recognized the makings of what some are calling the second wave of the craft beer movement and are seeking to capitalize on the demand by opening brand-new breweries.

Craft breweries are opening at an accelerated pace, and In Maryland alone, five, including Monocacy, are already in business or will be within a year.

The new businesses reflect a confidence in an appetite for the subtler flavors of craft, but brewers say their growth will be tested by the risks that accompany sales booms and state laws — like July's alcohol tax increase — they call hostile.

Boom and bust

Craft, which generally packs more complex flavors and nuance than average domestics, has been gradually growing in popularity since the late '70s and early '80s, and had a major boom in the '90s that then went bust.

"Every Tom, Dick and Harry jumped in with no idea what they were doing," Flores said. "And people got turned off."

Sales started to rebound in the decade that followed, and have not slowed down, jumping from 7.6 million barrels in 2006 to 10.5 million last year, according to the industry newsletter Beer Marketer's Insights.

Experts attribute the rebound to changes in American taste, with more people preferring to support local and regional businesses. Knowledge about craft, with the advent of beer weeks and more restaurants carrying beer alongside wine, has also created more awareness with the public. As that happens, retailers have been making more space for craft beer, said Paul Gatza, director of the Brewers Association, an industry group.

Craft still claims a small portion of the overall beer market, but while sales for mainstream beer have been declining for several years, a trend that was compounded by the faltering economy, the craft sector has been one of the few in the industry to actually see sales increase year to year, according to Beer Marketer's.

Brewers without a business of their own have been hip to the numbers and have kept up by opening new breweries — 1,587 in 2009 to 1,716 last year, according to the Brewers Association. The pace has accelerated this year.

While three years ago the association would see about 100 new breweries open, this year they're seeing twice as many, Gatza said. Over 760 others are in a planning stage.

In Maryland, one brewer besides Monocacy has opened — Burley Oak Brewing Company in Berlin. And three more are in the works — Milkhouse Brewery at Stillpoint Farm in Mount Airy; Union Craft Brewing, which will operate out of a warehouse in Woodberry; and the owner of Baltimore's The Raven beer, Steve Demczuk, who will install a working brew pub at the old Haussner's in Highlandtown. By February, Delaware's Evolution Craft Brewing will have moved to Salisbury.

That would bring the total of microbreweries in the state to at least 20, according to the Brewers Association of Maryland. Although Maryland used to house many producers of light lagers — Gunther, the National Brewing Co. — the only breweries in the state now fall under the category of microbreweries, which generally produce 6 million barrels of beer a year or less.

"It's unusual to hear about growing industries of any sort," said Mike Franklin, president of the Maryland association. "If it's something in an area that you have a passion for anyway, it smells like an opportunity. Things feed off each other."

Few brewers are as savvy as Flores. Tall and professorial, he's a kind of Indiana Jones of beer, with hands in all kinds of arcana of the trade, from growing his own barley, to recreating the beers of Colonial times.