It's up to Pa. brewery to can a bottling tradition

[August 18, 2010]  ST. MARYS, Pa. (AP) -- For years, it was the way breweries did business: sell bottles, then take back the empties. It just made sense, especially to folks weaned in the lean days of the Great Depression and World War II, that bottles should be scrubbed and refilled, not thrown away.

These days, in a culture where nearly everything is disposable, recycling is a rite and energy costs are high, the decision of whether to toss tradition into the trash heap lies with one brewery about 100 miles northeast of Pittsburgh.

The 138-year-old, family-owned Straub Brewery is begging customers -- mostly in Pennsylvania, but also some in Ohio, New York and Virginia -- to return thousands of empty cases. If enough customers do, Straub will keep selling cases of 12- and 16-ounce returnable bottles past year's end.

"It's not that we're totally into 'green,' but we think it's the right thing to do," said Dan Straub, great-grandson of company founder Peter Straub and the brewery's semiretired vice president. "Our philosophy is, 'Why recycle when you can reuse?'"

One other brewer -- the nation's oldest, D.G. Yuengling & Son of Pottsville, Pa. -- still sells and gathers returnables. But it expects to phase them out by summer's end, leaving Straub as what experts believe is the last holdout in the U.S.

Returnable bottles need to be cleaned, requiring extra energy. They are heavier so they won't break and must be shipped both ways, meaning fuel use and costs are significant for all but the smallest regional breweries. The larger breweries -- Anheuser-Busch, Miller and Coors -- gave up on returnables years ago because their costs multiplied with national distribution.

Straub customers pay a $1.50 deposit per 24-bottle case and can get it back or just buy another case when they return the bottles to the store, distributor or brewery.

The brewery spent more than $900,000 about five years ago to buy 150,000 cases of returnable bottles, and most of them are gone -- some broken, some thrown away, but, brewery officials suspect, most retained by customers unaccustomed to returning them or filled with home brews.

The brewery has so few bottles left, it's affecting production.

Straub can produce 1,500 24-bottle cases of 16-ounce returnables and 2,100 cases of 12-ounce returnables in a day. But one recent batch of 16-ounce returnables was just 753 cases -- because there were no more empties.

"When the system of returnables works, everybody wins," said Bill Brock, Straub's chief executive and great-great-grandson of the founder. "We're just not getting that glass back."

Soda companies are doing the same thing. LeRoy Telstad said his Coca-Cola Bottling Co. of Winona, Minn., is one of only two bottlers in the U.S. that still produces Coke in returnables. The other is in New Mexico.

"We're where Coke came from," Telstad said of his company, which serves four counties. "There used to be 2,700 bottlers of Coke in the United States, so it really was not just regional -- it was local."

The returnable-bottle model still works for Telstad because he serves an area less than 70 miles across and because returnable bottles of Coke and a few other flavors with the regional "Sunrise" label are a small fraction of his business. Ninety percent is soft drinks or juices sold in nonreturnable bottles and cans.

"It's become so much of a niche now," Telstad said. "Customers like the nostalgia of it."

Straub doesn't consider returnables a niche product but also doesn't need them to survive. Canned beer, added just last year, has been "flying out the door" and sales have never been better, Brock said.

"If we were a public company, it would be like, 'Dump that line,'" Brock said. "But it's our customers. Their fathers drank it, their grandfathers drank it. It's not just a business decision."

About 12 percent of all U.S. beer was sold in returnable bottles in 1981. Since 2007, the percentage has been negligible, according to statistics kept by the Washington, D.C.-based Beer Institute.

In Pennsylvania, more than a quarter of all beer sold in 1981 was in returnables. The state's antiquated liquor control laws required most beer to be sold by the case through distributors, so returning empty cases wasn't particularly inconvenient.

That has changed as convenience stores and supermarkets have increasingly gotten the OK to sell six- or 12-packs -- which come in nonreturnable bottles and cans.

About 20 percent of Straub is sold in kegs, and the brewery will produce about 45,000 cases of bottles and cans this year -- with 20 percent of that in returnable bottles, Brock said.

By contrast, Dick Yuengling said the 30,000 cases of 12-ounce returnables his brewery, founded in 1829, will churn out this year is too small of a percentage for him to figure out.

"The consumer's been indoctrinated; we're a throwaway society," he said. "Everybody's environmentally conscious, but if you put a case of returnable bottles in front of them, they say, 'What's that?'"

[Associated Press; By JOE MANDAK]

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