The brewery industry has been in steady decline, which has led to the closure of hundreds of local operators.
Total craft production fell 5% in 2025, with 60% of breweries reporting declines, 39% reporting growth, and 1% holding steady, according to the Brewers Association annual report.
Beer sales by business model:
- Brewpubs: -1.7%
- Taprooms: -3.9%
- Microbreweries: -8.9%
- Regional breweries: -5.9%
“Craft beer outpaced the overall beer category, which declined 5.7% by volume, highlighting relative resilience within a contracting market,” the association shared.
Now, another regional favorite brewery has made the decision to close its doors.
Southern Star Brewing Company, widely credited as one of the first Texas craft breweries to package beer in cans, will shut its doors and cease brewing operations forever after 18 years on June 28, according to an Instagram post from the company.
Craft breweries have been struggling
The craft beer market continued its historic decline in 2025, with a 5.1% decrease in production and 2.9% contraction in U.S. breweries, according to the Brewers Association’s data.
“Across the country, breweries both large and small shut their doors in 2025. Some had been neighborhood fixtures for a decade or more. Others were younger operations that never quite found their footing in an increasingly crowded and competitive market. Taken together, the closures painted a picture of an industry still recalibrating after years of rapid growth, pandemic disruptions, and shifting consumer habits,” American Craft Beer wrote.
I’ve watched this happen in my own backyard. Here in West Palm Beach, the wave started during Covid. The area had more than a dozen craft brewers before the pandemic and now has only a handful. Southern Star Brewing Company’s closure in Texas is the same story playing out a thousand miles away.
That follows the national trend.
In 2025, 434 U.S. craft breweries closed their doors, compared with 268 openings, meaning closures outpaced openings by a considerable margin, according to industry tracking from the Brewers Association (BA).
“Changing consumer behaviors, retailer rationalization, cost increases due to inflation and tariffs, and more competition than ever have been compounding difficulties in 2025. And still, brewers are stepping up to meet today’s challenges head on by adjusting their offerings and, sometimes, their entire business models,” BA Staff Economist Matt Gacioch said.
TheStreet’s retail advisor and RTMNexus CEO Dominick Miserandino believes the closures are largely not driven by the slight drop in beer consumption.
“The math catching up to the industry is incredibly straightforward: Too many breweries scaled up to do the exact same thing at the exact same time. Everyone built out a massive brewing operation to supply local retail stores, completely oversaturating the market,” he shared with TheStreet.
Southern Star Brewing Company’s closure follows a growing wave of craft brewery shutdowns, including several award-winning and regional beer brands that have recently ceased operations.
The industry’s oversupply problems have coincided with a broader decline in alcohol consumption across the United States.
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Americans are drinking less
After a spike in alcohol consumption during the pandemic, fewer Americans are drinking, according to a Gallup Poll.
The percentage of U.S. adults who say they consume alcohol has fallen to 54%, the lowest by one percentage point in Gallup’s nearly 90-year trend.
“This coincides with a growing belief among Americans that moderate alcohol consumption is bad for one’s health, now the majority view for the first time,” Gallup shared.
Gallup has tracked Americans’ drinking behavior since 1939 and their views of the health implications of moderate drinking since 2001.
The study also showed:
- From 1997 to 2023, at least 60% of Americans reported drinking alcohol.
- The figure fell to 62% in 2023 and to 58% in 2024, before reaching 54% today.
- Prior to the most recent poll, the rate has been under 60% fewer than 10 times, including 58% in the initial 1939 poll and a one-time low of 55% recorded in 1958.
- The highs of 68% to 71% were all recorded between 1974 and 1981.
“The consecutive declines in Americans’ reported drinking the past few years are unmatched in Gallup’s trend and coincide with recent research indicating that any level of alcohol consumption may negatively affect health. This has been a sharp reversal from previous recommendations that moderate drinking could offer some protective benefits,” Gallup shared.
Southern Star Brewing Company shutting down
Southern Star Brewing Company shared the news of its closing on Instagram.
“After many incredible years, we’ve made the difficult decision to close our doors and bring this chapter of Southern Star Brewing Company to an end on June 28, 2026,” the company posted.
The brewer did not share a reason for closing its doors.
Southern Star Brewing did not disclose how many employees would be affected by the closure or what would happen to the brewery’s equipment and property.
“This brewery was never just about beer. It was about the people, the memories, the friendships, the concerts, the weekends, the celebrations, and the stories shared over a pint,” it added.
Hundreds of Southern Star Brewing customers responded to the post.
“Bombshell Blonde will be deeply missed. Thank you for making it. I wish I had a stash or at least a T-shirt of the logo,” @CardigansJournal posted.
Many customers said thank you and lamented that beers that will no longer be produced.
“Pine belt pale ale! Valkyrie! Black Crack 2015! Lisa Franc! Y’all made so many great beers, had an amazing venue, and threw awesome parties! Thank you for making such wonderful beer for so long, y’all will definitely be missed,” Juan Fuentes posted.
Founded in 2008 by brewmaster Dave Fougeron, the brewery’s first facility was on FM 3083 before opening a custom-built facility in 2016 on 13 acres at 3525 N. Frazier Street, just north of Conroe. In addition to brewing and manufacturing craft beer, the venue featured indoor and outdoor gathering spaces, according to the Houston Chronicle.
Southern Star Brewing Company’s most popular craft beers include Bombshell Blonde and Buried Hatchet.
