Sydney’s iconic Malt Shovel Brewery, a landmark in Australia’s craft beer history, will close its doors at the end of August 2024. Parent company Lion confirmed the closure this week, citing a range of economic pressures, including soaring production costs, declining beer consumption, and increasing government excise duties.

Established in 1988 by independent brewer Chuck Hahn and later acquired by Lion in 1993, Malt Shovel Brewery played a central role in shaping Australia’s craft beer movement. Known for producing popular brands such as Little Creatures and New Belgium, the brewery has long been considered a cornerstone of the local beer scene.

A tough call in challenging times

Lion’s managing director James Brindley called the decision a “difficult one,” acknowledging the impact on the brewery’s team and the broader industry. “This week we’ve informed our valued team members at Malt Shovel Brewery of the difficult decision we have taken – which is that we are proposing to close the site at the end of August 2024,” he said in a statement.

Brindley pointed to declining beer volumes—down by 100 million litres since 2019—as a key factor, part of a broader, long-term trend of reduced alcohol consumption in Australia. Rising production costs, including energy, labour, and raw ingredients, have also placed mounting pressure on brewers.

Excise among the world’s highest

Adding to the challenges is the cost of excise duty in Australia, which Brindley noted is now the third-highest globally. Combined with the impact of inflation and cost-of-living pressures that are reducing consumer spending, the economics of running a brewery like Malt Shovel have become increasingly unsustainable.

The closure will see brewing operations relocated to Lion’s facilities in northern New South Wales and Geelong in Victoria. While the decision consolidates production to cut costs, it also signals the end of an era for the brewery that helped lay the foundation for Australia’s thriving craft beer culture.

A pioneer in Australian craft beer

Chuck Hahn’s vision when he opened Malt Shovel Brewery in 1988 was to challenge the dominance of mainstream lagers with bold, flavour-forward beers. His influence, and the brewery’s success, paved the way for a wave of independent brewers across the country and helped shift national tastes toward more adventurous beer styles.

Over the decades, the brewery became synonymous with innovation and quality, producing beloved brands and fostering a loyal community of beer lovers. Its closure is likely to be felt deeply by those who view the site as a symbol of Australia’s modern brewing renaissance.

As the industry grapples with ongoing change, the legacy of Malt Shovel Brewery will endure—not just in the beers it produced, but in the impact it had on the craft brewing movement nationwide.